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You are here: BAILII >> Databases >> United Kingdom Supreme Court >> Public Relations Consultants Association Ltd v The Newspaper Licensing Agency Ltd & Ors [2013] UKSC 18 (17 April 2013) URL: https://www.bailii.org/uk/cases/UKSC/2013/18.html Cite as: [2013] RPC 19, [2013] EMLR 21, [2013] 2 All ER 852, [2013] ECDR 10, [2013] UKSC 18, [2013] 3 CMLR 11 |
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Easter Term
[2013] UKSC 18
On appeal from: [2011] EWCA Civ 890
JUDGMENT
Public Relations Consultants Association Limited (Appellant) v The Newspaper Licensing Agency Limited and others (Respondents)
before
Lord Neuberger, President
Lord Kerr
Lord Clarke
Lord Sumption
Lord Carnwath
JUDGMENT GIVEN ON
17 April 2013
Heard on 11 and 12 February 2013
Appellant Henry Carr QC Andrew Lykiardopoulos (Instructed by Baker & McKenzie LLP) |
Respondent Robert Howe QC Edmund Cullen QC (Instructed by Berwin Leighton Paisner LLP) |
LORD SUMPTION (with whom Lord Neuberger, Lord Kerr, Lord Clarke and Lord Carnwath agree)
The issue
Directive 2001/29/EC
"It shall be a matter for legislation in the countries of the Union to permit the reproduction of such works in certain special cases, provided that such reproduction does not conflict with a normal exploitation of the work and does not unreasonably prejudice the legitimate interests of the author."
The problem, as the Commission saw it in 1997, was that different member states had made use of the liberty conferred by article 9(2) to legislate in different ways for the treatment of copyright works made available in digital form and these differences were liable to impede the development of the internal market. The purpose of the Directive, a draft of which was annexed to the proposal, was to harmonise the rules across the EU.
"A fair balance of rights and interests between the different categories of rightholders, as well as between the different categories of rightholders and users of protected subject-matter must be safeguarded. The existing exceptions and limitations to the rights as set out by the Member States have to be reassessed in the light of the new electronic environment."
Recital 33 referred directly to the problem of temporary copies in the following terms:
"The exclusive right of reproduction should be subject to an exception to allow certain acts of temporary reproduction, which are transient or incidental reproductions, forming an integral and essential part of a technological process and carried out for the sole purpose of enabling either efficient transmission in a network between third parties by an intermediary, or a lawful use of a work or other subject-matter to be made. The acts of reproduction concerned should have no separate economic value on their own. To the extent that they meet these conditions, this exception should include acts which enable browsing as well as acts of caching to take place, including those which enable transmission systems to function efficiently, provided that the intermediary does not modify the information and does not interfere with the lawful use of technology, widely recognised and used by industry, to obtain data on the use of the information. A use should be considered lawful where it is authorised by the rightholder or not restricted by law."
"1. Temporary acts of reproduction referred to in Article 2, which are transient or incidental [and] an integral and essential part of a technological process and whose sole purpose is to enable:
(a) a transmission in a network between third parties by an intermediary, or
(b) a lawful use
of a work or other subject-matter to be made, and which have no independent economic significance, shall be exempted from the reproduction right provided for in Article 2.
...
5. The exceptions and limitations provided for in paragraphs 1, 2, 3 and 4 shall only be applied in certain special cases which do not conflict with a normal exploitation of the work or other subject-matter and do not unreasonably prejudice the legitimate interests of the rightholder."
Chapters III and IV then make extensive provision for the enforcement of copyright owners' rights in the digital world.
The case law of the Court of Justice
Infopaq I
"— the act is temporary;
— it is transient or incidental;
— it is an integral and essential part of a technological process;
— the sole purpose of that process is to enable a transmission in a network between third parties by an intermediary of a lawful use of a work or protected subject-matter; and
— the act has no independent economic significance."
This formulation has been repeated in this form in the subsequent case-law, and it is undoubtedly convenient. It is, however, important to remember that it is a paraphrase. Notwithstanding that the five conditions are laid out in five separate sub-paragraphs, they are not free-standing requirements. They are overlapping and repetitive, and each of them colours the meaning of the others. They have to be read together so as to achieve the combined purpose of all of them. This is, as the case-law demonstrates, what the Court of Justice has always done.
"56 For the interpretation of each of those conditions in turn, it should be borne in mind that, according to settled case-law, the provisions of a Directive which derogate from a general principle established by that Directive must be interpreted strictly (Criminal Proceedings against Kapper (C-476/01) [2004] ECR I-5205, ECJ at [72], and Commission of the European Communities v Spain (C-36/05) [2006] ECR I-10313 ECJ at [31]).
57 This holds true for the exemption provided for in art.5(1) of Directive 2001/29, which is a derogation from the general principle established by that Directive, namely the requirement of authorisation from the rightholder for any reproduction of a protected work.
58 This is all the more so given that the exemption must be interpreted in the light of art.5(5) of Directive 2001/29, under which that exemption is to be applied only in certain special cases which do not conflict with a normal exploitation of the work or other subject matter and do not unreasonably prejudice the legitimate interests of the rightholder."
At paras 61-64 the court summarised the position in this way:
"61 The court finds, in the light of the third condition referred to in [54] of this judgment, that a temporary and transient act of reproduction is intended to enable the completion of a technological process of which it forms an integral and essential part. In those circumstances, given the principles set out in [57] and [58] of this judgment, those acts of reproduction must not exceed what is necessary for the proper completion of that technological process.
62 Legal certainty for rightholders further requires that the storage and deletion of the reproduction not be dependent on discretionary human intervention, particularly by the user of protected works. There is no guarantee that in such cases the person concerned will actually delete the reproduction created or, in any event, that he will delete it once its existence is no longer justified by its function of enabling the completion of a technological process.
63 This finding is supported by recital 33 in the preamble to Directive 2001/29 which lists, as examples of the characteristics of the acts referred to in art.5(1) thereof, acts which enable browsing as well as acts of caching to take place, including those which enable transmission systems to function efficiently. Such acts are, by definition, created and deleted automatically and without human intervention.
64 In the light of the foregoing, the court finds that an act can be held to be 'transient' within the meaning of the second condition laid down in art.5(1) of Directive 2001/29 only if its duration is limited to what is necessary for the proper completion of the technological process in question, it being understood that that process must be automated so that it deletes that act automatically, without human intervention, once its function of enabling the completion of such a process has come to an end."
Addressing the question of copy (iii) (the text file containing the keyword extracts), the court added,
"66 ... It is for the national court to ascertain whether the deletion of that file is dependent on the will of the user of the reproduction and whether there is a risk that the file might remain stored once the function of enabling completion of the technological process has come to an end."
The Premier League case
"168 As is apparent from recital 33 in the preamble to the Copyright Directive, a use should be considered lawful where it is authorised by the right holder or where it is not restricted by the applicable legislation.
169 Since in the main proceedings the use of the works at issue is not authorised by the copyright holders, it must be determined whether the acts in question are intended to enable a use of works which is not restricted by the applicable legislation.
170 In this regard, it is undisputed that those ephemeral acts of reproduction enable the satellite decoder and the television screen to function correctly. From the television viewers' standpoint, they enable the broadcasts containing protected works to be received.
171 Mere reception as such of those broadcasts—that is to say, the picking up of the broadcasts and their visual display—in private circles does not reveal an act restricted by EU legislation or by that of the United Kingdom, as indeed follows from the wording of Question 5 in Case C-403/08, and that act is therefore lawful. Furthermore, it follows from [77]–[132] of the present judgment that such reception of the broadcasts must be considered lawful in the case of broadcasts from a Member State other than the United Kingdom when it is brought about by means of a foreign decoding device.
172 Accordingly, the acts of reproduction have the sole purpose of enabling a 'lawful use' of the works within the meaning of art.5(1)(b) of the Copyright Directive.
173 Acts of reproduction such as those at issue in the main proceedings thus satisfy the fourth condition laid down by that provision."
"174 So far as concerns, finally, the fifth condition laid down by that provision, these acts of reproduction carried out in the course of a technological process make access to the protected works possible. Since the latter have an economic value, access to them necessarily has economic significance.
175 However, if the exception laid down in art.5(1) of the Copyright Directive is not to be rendered redundant, that significance must also be independent in the sense that it goes beyond the economic advantage derived from mere reception of a broadcast containing protected works, that is to say, beyond the advantage derived from the mere picking up of the broadcast and its visual display.
176 In the main proceedings, the temporary acts of reproduction, carried out within the memory of the satellite decoder and on the television screen, form an inseparable and non-autonomous part of the process of reception of the broadcasts transmitted containing the works in question. Furthermore, they are performed without influence, or even awareness, on the part of the persons thereby having access to the protected works.
177 Consequently, those temporary acts of reproduction are not capable of generating an additional economic advantage going beyond the advantage derived from mere reception of the broadcasts at issue.
178 It follows that the acts of reproduction at issue in the main proceedings cannot be regarded as having independent economic significance. Consequently, they fulfil the fifth condition laid down in art.5(1) of the Copyright Directive.
179 This finding, and the finding set out in [172] of the present judgment [that the copying had the purpose of enabling a lawful use], are moreover borne out by the objective of that provision, which is intended to ensure the development and operation of new technologies. If the acts at issue were not considered to comply with the conditions set by art.5(1) of the Copyright Directive, all television viewers using modern sets which, in order to work, need those acts of reproduction to be carried out would be prevented from receiving broadcasts containing broadcast works, in the absence of an authorisation from copyright holders. That would impede, and even paralyse, the actual spread and contribution of new technologies, in disregard of the will of the EU legislature as expressed in recital 31 in the preamble to the Copyright Directive."
Infopaq II
"30 The concept of the 'integral and essential part of a technological process' requires the temporary acts of reproduction to be carried out entirely in the context of the implementation of the technological process and, therefore, not to be carried out, fully or partially, outside of such a process. This concept also assumes that the completion of the temporary act of reproduction is necessary, in that the technological process concerned could not function correctly and efficiently without that act (see, to that effect, Infopaq International, paragraph 61).
...
37 Finally, it should be noted that the technological process in question could not function correctly and efficiently without the acts of reproduction concerned. That technological process aims at identifying predefined key words in newspaper articles and extracting them on a digital medium. Such electronic research thus requires a transformation of those articles, from a paper-based medium, into digital data, since that transformation is necessary in order to recognise that data, to identify the key words and to extract those key words."
"48 In that regard, it should be recalled that the acts of temporary reproduction, within the meaning of Article 5(1), aim to make access to the protected works and their use possible. Since those works have a specific economic value, access to them and their use necessarily has economic significance (see, to that effect, Football Association Premier League [2012] 1 CMLR 29, paragraph 174).
49 Furthermore, as is apparent from Recital 33 in the preamble to Directive 2001/29, the acts of temporary reproduction — like the acts enabling 'browsing' and 'caching' — have the purpose of facilitating the use of a work or making that use more efficient. Thus, an inherent feature of those acts is to enable the achievement of efficiency gains in the context of such use and, consequently, to lead to increased profits or a reduction in production costs.
50 However, those acts must not have independent economic significance, in that the economic advantage derived from their implementation must not be either distinct or separable from the economic advantage derived from the lawful use of the work concerned and it must not generate an additional economic advantage going beyond that derived from that use of the protected work (see, to that effect, Football Association Premier League and Others, paragraph 175).
51 The efficiency gains resulting from the implementation of the acts of temporary reproduction, such as those in issue in the main proceedings, have no such independent economic significance, inasmuch as the economic advantages derived from their application only materialise during the use of the reproduced subject matter, so that they are neither distinct nor separable from the advantages derived from its use.
52 On the other hand, an advantage derived from an act of temporary reproduction is distinct and separable if the author of that act is likely to make a profit due to the economic exploitation of the temporary reproductions themselves."
"56 In that regard, suffice it to note that if those acts of reproduction fulfil all the conditions of Article 5(1) of Directive 2001/29, as interpreted by the case-law of the Court, it must be held that they do not conflict with the normal exploitation of the work or unreasonably prejudice the legitimate interests of the rightholder (Football Association Premier League and Others, paragraph 181).
57 Consequently, the answer to the seventh question is that Article 5(5) of Directive 2001/29 must be interpreted as meaning that, if they fulfil all the conditions laid down in Article 5(1) of that directive, the acts of temporary reproduction carried out during a 'data capture' process, such as those in issue in the main proceedings, must be regarded as fulfilling the condition that the acts of reproduction may not conflict with a normal exploitation of the work or unreasonably prejudice the legitimate interests of the rightholder."
The effect of the CJEU decisions
(1) Subject to the limitations which I shall summarise in the following sub-paragraphs, the exception in article 5.1 applies to copies made as an integral and necessary part of a "technological process", in particular the digital processing of data. For this purpose, the making of copies is a "necessary" part of the process if it enables it to function "correctly and efficiently": Infopaq II, at paras 30, 37.
(2) These copies must be temporary. This requirement is explained and defined by the words which follow, namely that the making of the copies must be "transient or incidental and an integral and essential part of a technological process". It means (i) that the storage and deletion of the copyright material must be the automatic consequence of the user's decision to initiate or terminate the relevant technological process, as opposed to being dependent on some further discretionary human intervention, and (ii) that the duration of the copy should be limited to what is necessary for the completion of the relevant technological process: see Infopaq I, at paras 62 and 64.
(3) The exception is not limited to copies made in order to enable the transmission of material through intermediaries in a network. It also applies to copies made for the sole purpose of enabling other uses, provided that these uses are lawful. These other uses include internet browsing: Infopaq I, at para 63 and Infopaq II, at para 49.
(4) For the purpose of article 5.1, a use of the material is lawful, whether or not the copyright owner has authorised it, if it is consistent with EU legislation governing the reproduction right, including article 5.1 itself: Premier League, at paras 168-173, Infopaq II, at para 42. The use of the material is not unlawful by reason only of the fact that it lacks the authorisation of the copyright owner.
(5) The making of the temporary copy must have no "independent economic significance". This does not mean that it must have no commercial value. It may well have. What it means is that it must have no independent commercial value, i.e. no value additional to that which is derived from the mere act of digitally transmitting or viewing the material: Premier League, at para 175, Infopaq II, at para 50.
(6) If these conditions are satisfied no additional restrictions can be derived from article 5.5.
Application to the present case
Consequences
The decisions below
Reference