OPINION OF ADVOCATE GENERAL
SZPUNAR
delivered on 7 September 2017 (1)
Case C‑265/16
VCAST Limited
v
RTI SpA
(Request for a preliminary ruling
from the Tribunale di Torino (District Court, Turin, Italy))
(Reference for a preliminary ruling — Intellectual and industrial property — Copyright and related rights — Reproduction right — Exception — Reproduction for private use — Provision of a remote video recording (cloud computing) service for reproductions of television programmes for private use without the copyright holders’ consent — Intervention of the service provider in the recording — Making available of those programmes)
Introduction
1. Cloud computing is defined as access via a telecommunication network (internet), on demand and on a self-service basis, to configurable shared computing resources. It is thus a delocalisation of computing infrastructure. (2) A distinctive feature of cloud computing is that, unlike conventional ways of using computing infrastructure, the user does not purchase or lease physical computer equipment, but uses, in the form of services, infrastructure capacities belonging to a third party, the location of which is not known to the user and which may vary. From the point of view of that user, those capacities are thus ‘somewhere in the cloud’ (not in an atmospheric sense, but in a computing sense of course). This arrangement allows resources to be used more effectively and to be adapted automatically to fluctuations in demand.
2. The services provided in the form of cloud computing are very varied, ranging from the simple provision of computing infrastructure, software and communication tools (email) to the most sophisticated services. Of the cloud services provided to consumers, one of the most common is data storage. Many providers offer storage capacities in different sizes, free of charge or as a paid service, using various business models. Those storage capacities are normally intended for the private use of the beneficiary, but they can also include sharing functions. The storage services are often accompanied by related services, such as indexing of stored data or data processing, for example image-processing tools.
3. Data stored in the cloud can contain, among other things, reproductions of works protected by copyright made by users of those storage services under the private copying exception. However, unlike the use of reproduction equipment directly available to the copyist, in the case of reproduction in the cloud, intervention by the provider of the storage service or another person is normally necessary. It is therefore reasonable to ask the question whether, in that case, the reproduction is still made ‘by’ the beneficiary of the private copying exception, as required by the legislation. It is on this point that the arguments made in the present case have focused.
4. I nevertheless think that, in the light of the facts of the dispute in the main proceedings, this raises a more fundamental question: the limits of the private copying exception with regard to the origin of the work which is the subject matter of the reproduction. The Court has already addressed this question in a number of cases concerning the fee due in respect of the private copying exception. I think that the case-law on this subject warrants some clarification.
Legislative framework
EU law
5. Directive 2000/31/EC of the European Parliament and of the Council of 8 June 2000 on certain legal aspects of information society services, in particular electronic commerce, in the Internal Market (‘Directive on electronic commerce’) (3) provides, in Article 3(2) and (3):
‘2. Member States may not, for reasons falling within the coordinated field, restrict the freedom to provide information society services from another Member State.
3. Paragraphs 1 and 2 shall not apply to the fields referred to in the Annex.’
6. The Annex to Directive 2000/31, entitled ‘Derogations from Article 3’, provides in its first indent:
‘As provided for in Article 3(3), Article 3(1) and (2) do not apply to:
– copyright, neighbouring rights …’
7. Under Article 2 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: (4)
‘Member States shall provide for the exclusive right to authorise or prohibit direct or indirect, temporary or permanent reproduction by any means and in any form, in whole or in part:
(a) for authors, of their works;
(b) for performers, of fixations of their performances;
(c) for phonogram producers, of their phonograms;
(d) for the producers of the first fixations of films, of the original and copies of their films;
(e) for broadcasting organisations, of fixations of their broadcasts, whether these broadcasts are transmitted by wire or over the air, including by cable or satellite.’
8. Article 5(2)(b) and (5) of Directive 2001/29 provides:
‘2. Member States may provide for exceptions or limitations to the reproduction right provided for in Article 2 in the following cases:
…
(b) in respect of reproductions on any medium made by a natural person for private use and for ends that are neither directly nor indirectly commercial, on condition that the rightholders receive fair compensation which takes account of the application or non-application of technological measures referred to in Article 6 to the work or subject-matter concerned;
…
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.’
Italian law
9. Copyright is governed in Italian law by Legge n. 633/1941 — Protezione del diritto d’autore e di altri diritti connessi al suo esercizio (Law No 633/1941 on the protection of copyright and other rights relating to its exercise) of 22 April 1941 (‘the Law on copyright’). The private copying exception is laid down in Article 71 sexies of the Law on copyright, which reads as follows:
‘1. The private reproduction of phonograms and videograms on any medium made by a natural person for personal use only shall be permitted, provided it is not for profit or it is for ends that are neither directly nor indirectly commercial, in compliance with the technological measures referred to in Article 102 quater.
2. The reproduction referred to in paragraph 1 may not be carried out by a third party. The provision of services for the reproduction of phonograms and videograms by a natural person for personal use shall constitute a reproduction activity covered by the provisions in Articles 13, 72, 78 bis, 79 and 80.
…
4. Without prejudice to the provisions in paragraph 3, rightholders shall be required, notwithstanding the application of the technological measures provided for in Article 102 quater, to permit a natural person who has acquired legitimate possession of copies of the protected work or subject matter or has accessed them legitimately to be able to make a private copy of them, even merely an analogue copy, for personal use, provided that possibility does not conflict with a normal exploitation of the work or other subject matter and does not constitute unjust enrichment to the detriment of rightholders.’
10. Article 71 septies of the Law introduces compensation for copyright holders in respect of the private copying exception. That compensation is financed by a fee levied on the selling price of equipment and media which allows copies of works protected by copyright to be made. The last sentence of paragraph 1 of that article reads as follows:
‘In respect of remote video recording systems, the compensation referred to in this paragraph shall be due from the person who provides the service and correspond to the remuneration obtained for providing that service.’
11. This last sentence was inserted by a legislative amendment of 31 December 2007. According to information provided by the Italian Government, its introduction gave rise to infringement proceedings brought by the European Commission for the alleged infringement of Article 2, entitled ‘Reproduction right’, and Article 3, entitled ‘Right of communication to the public’, of Directive 2001/29. On account of the allegations made by the Commission, the Italian authorities decided not to set a fee for remote recording services. This choice was considered to be lawful by the Italian courts. In particular, the Consiglio di Stato (Council of State, Italy) ruled that the authorities decided ‘lawfully to suspend the application of the last sentence of paragraph 1 temporarily’.
Facts, procedure and questions referred for a preliminary ruling
12. VCAST Limited is a company incorporated under UK law which provides its users with a cloud recording system for free-to-air terrestrial programmes broadcast by Italian television organisations, including RTI SpA (RTI). In practice, the user selects a programme on the VCAST website, which includes all the programming from the television channels covered by the service. The user can specify either a certain programme or a time slot, knowing that in the former case it is the time slot in which the selected programme is scheduled that will be recorded. The system operated by VCAST then picks up the television signal using its own antennas and records the time slot for the selected programme in the cloud data storage space indicated by the user. That storage space is not provided by VCAST but by third-party providers. (5) The audiovisual data thus recorded are then made available to the user on the conditions specified by the storage service provider. The VCAST service has three options: one option which is free to the user and financed by advertising and two paid options.
13. VCAST brought proceedings against RTI before the Tribunale di Torino (District Court, Turin, Italy), the referring court, seeking a declaration of the lawfulness of its activities, if necessary after either raising a question regarding the constitutionality of Article 71 sexies(2) of the Law on copyright or referring a question to the Court of Justice for a preliminary ruling on the interpretation of EU law. VCAST claims, in essence, that its activity comes under the private copying exception, as it is the user who actually makes the recording, VCAST only providing the necessary equipment, namely the remote video recording system. According to VCAST, the lawfulness of its service is confirmed in particular by the last sentence of Article 71 septies(1) of the Law on copyright which, by making remote recording services subject to a fee, treats those services in the same way as the exercise of the private copying exception.
14. RTI, the defendant in the main proceedings, challenges the lawfulness of VCAST’s activity. It has made a counterclaim seeking to prohibit VCAST from pursuing the activity in question and compensation for damage suffered as a result of that activity. By order for reference of 30 October 2015, the referring court adopted interim measures, in particular prohibiting VCAST from pursuing its activity with regard to programmes broadcast by the RTI television channels.
15. After it considered that the resolution of the dispute required an interpretation of provisions of EU law, in particular Article 5(2)(b) of Directive 2001/29, the Tribunale di Torino (District Court, Turin) stayed the proceedings and referred the following questions to the Court for a preliminary ruling:
‘(1) Are national rules prohibiting a commercial undertaking from providing private individuals with so-called cloud computing services for the remote video recording of private copies of works protected by copyright, by means of that commercial undertaking’s active involvement in the recording, without the rightholder’s consent, compatible with EU law, in particular with Article 5(2)(b) of Directive 2001/29 … (as well as Directive 2000/31 … and the founding Treaty)?
(2) Are national rules which allow a commercial undertaking to provide private individuals with so-called cloud computing services for the remote video recording of private copies of works protected by copyright, even where the active involvement of that commercial undertaking in the recording is entailed, and even without the rightholder’s consent, against a flat-rate compensation in favour of the rightholder, in essence subjecting the services to a compulsory licensing system, compatible with EU law, in particular with Article 5(2)(b) of Directive 2001/29 … (as well as Directive 2000/31 … and the founding Treaty)?’
16. The request for a preliminary ruling was received at the Court on 12 May 2016. Written observations were submitted by the parties in the main proceedings, the Italian, French and Portuguese Governments and the Commission. The parties in the main proceedings, the Italian Government and the Commission were represented at the hearing held on 29 March 2017.
Analysis
Preliminary remarks
17. The two questions actually concern the same legal problem seen from two different perspectives. In essence, it must be determined whether the provisions of EU law mentioned in the questions require Member States which have transposed the private copying exception into their domestic law to permit, or, on the contrary, prohibit them from permitting, the activity of providing, without the copyright holders’ consent, an online (cloud) recording service for terrestrial television programmes which are freely accessible in the territory of the Member State concerned.
18. As regards identification of the provisions of EU law whose interpretation is being sought, only Article 5(2)(b) of Directive 2001/29 has been clearly indicated.
19. As far as Directive 2000/31 is concerned, the provision which could possibly be applicable in this case is Article 3(2), which prohibits Member States from restricting the freedom to provide information society services from another Member State. The service provided by VCAST would appear to fulfil the criteria for the definition of information society service. However, under Article 3(3) in conjunction with the Annex to Directive 2000/31, restrictions stemming from the protection of copyright and neighbouring rights are excluded from the scope of that prohibition. It is precisely on this basis that VCAST’s activity could be considered unlawful in Italian law. Article 3(2) of Directive 2000/31 does not therefore seem to be applicable in this case.
20. In addition, as far as the ‘founding Treaty’ is concerned, neither the wording of the questions referred nor the reasoning contained in the request for a preliminary ruling provides any clear guidance for identifying the provision of primary law to which the national court refers. As RTI asserts in its observations, moreover, this casts doubt on the admissibility of the questions referred in so far as they relate to ‘the founding Treaty’. In a spirit of goodwill and following the logic employed in the preceding point with regard to Directive 2000/31, I can only assume that the provision which the referring court has in view is the one concerning the freedom to provide services in Article 56 TFEU. As VCAST is a company established in the United Kingdom, it provides a cross-border service, which allows it to benefit from that freedom.
21. However, in any event, according to settled case-law, the protection of copyright constitutes an overriding reason in the public interest which can justify a restriction on the freedom to provide services. (6) Furthermore, it is a harmonised field in which a finding that the activity in question is unlawful having regard to a provision of EU law is sufficient to justify the corresponding restriction on the freedom to provide services. Thus, in the light of the answer to the questions which I intend to propose to the Court, any restriction on the freedom to provide services supplied by VCAST would in any case be largely justified by the objective of the effective protection of copyright.
22. In the light of the foregoing, I therefore propose to examine the questions only from the perspective of Article 5(2)(b) of Directive 2001/29. So that the examination is useful for the resolution of the dispute in the main proceedings, which concerns the lawfulness of the service provided by VCAST, it will also take account of the particular way in which that service operates.
The question of cloud recording under the private copying exception
23. It should be recalled that Article 5(2)(b) of Directive 2001/29 defines private copying as ‘reproductions on any medium made by a natural person for private use and for ends that are neither directly nor indirectly commercial’. (7) It is not disputed that making reproductions and storing them in the cloud requires the intervention of third persons: first and foremost, the provider of the storage capacities and possibly other persons. It is therefore reasonable to ask if and to what extent the abovementioned provision permits such intervention.
24. First, the Court’s case-law concerning compensation in connection with the private copying exception seems to offer fairly clear guidance with regard to the possession and the making available of storage capacities. According to that case-law, even though the persons liable to pay compensation are, in principle, users who make reproductions under that exception, for practical reasons the Member States are entitled to collect that compensation from the persons who make recording media or equipment available to the public. (8) Although in most cases such making available occurs through the sale of media or equipment, compensation being levied on the price of sale, in my view there is nothing in principle to prevent it from taking the form of the making available of cloud storage capacities. This position is corroborated by the Court’s case-law, according to which compensation in respect of the private copying exception may relate to reproductions made by a private individual with the aid of a device which belongs to a third party. (9)
25. Second, with regard to the intervention of third parties in the act of reproduction itself, I consider that an excessively strict interpretation of Article 5(2)(b) of Directive 2001/29 would not be justified. It is clear that the reproduction of a work under the private copying exception and its recording in the cloud, that is, in a data storage space not directly accessible to the user who makes that reproduction, requires the intervention of a third party, whether the provider of that storage space or another person. The initialisation of the reproduction by the user triggers a number of processes, which are more or less automated, resulting in the creation of a copy of the work in question. I do not think that this form of reproduction should be excluded from the scope of the private copying exception simply by reason of the intervention of a third party which goes beyond simply making available media or equipment. As long as it is the user who takes the initiative in respect of the reproduction and defines its object and modalities, I cannot see a decisive difference between such an act and a reproduction made by the same user with the aid of equipment which he controls directly. (10) Furthermore, the case-law cited in the preceding point explicitly recognises that compensation in respect of the private copying exception concerns reproductions made in the context of the provision of copying services. (11)
26. The fact that the intervention of a third party in the making of the reproduction may be for remuneration does not invalidate this conclusion, as the requirement of non-commercial ends in Article 5(2)(b) of Directive 2001/29 does not relate to any intervention by a third party, but to the use of the copy by the beneficiary of the exception in question.
27. Lastly, I would add that the fact, raised by RTI at the hearing, that the user is able to share content recorded in the cloud with other internet users, thereby going beyond the scope of private use of the copy, does not seem relevant. Cloud data storage services often include data-sharing features. Thus, once a private copy of protected subject matter is recorded as part of such a service, it is technically possible for the user to share that copy with an indefinite, potentially sizeable number of third persons. Such sharing could go beyond the scope of the permitted use for private copying and, as a result, be classified as unauthorised making available. This possibility is not unique to cloud recording, however, as at present any copies, in particular digital copies, can be easily shared using the internet, thereby infringing copyright. It is the responsibility of users to refrain from committing such infringements. On the other hand, I am not convinced that the mere existence of this theoretical possibility should lead to cloud recording being excluded from eligibility for the private copying exception.
28. Accordingly, there appears to be nothing to suggest that Article 5(2)(b) of Directive 2001/29 prevents the reproduction under the exception provided for in that article being made in storage space in the cloud.
The question of access to the subject matter of the reproduction
29. The situation seems more complicated as regards the origin of works reproduced under the private copying exception. Although the Court’s case-law acknowledges, on the one hand, that private copies are made with the aid of devices which belong to third parties, it requires, on the other, that the user lawfully accesses the subject matter of the reproduction. I have doubts that a service like that offered by VCAST fulfils this latter requirement.
Access to the subject matter of the reproduction according to the Court’s case-law
30. The Court has already had the opportunity to answer the question whether Article 5(2)(b) of Directive 2001/29 precluded national legislation providing for compensation in respect of copies of protected works made not only with the aid of a device which belonged to a third party, but also by such a device. (12) The Court replied in the negative, holding that that provision did not regulate at all the legal connection between the person making the reproduction under the private copying exception and the device used for that purpose (13) and that the device used could therefore certainly belong to a third party. (14)
31. This finding made by the Court might suggest that any copy made for the private use of a natural person comes under the exception laid down in Article 5(2)(b) of Directive 2001/29. This conclusion needs to be qualified, however.
32. The Court also ruled that eligibility for the private copying exception is subject to the lawfulness of the source of the reproduction. (15) In other words, Article 5(2)(b) of Directive 2001/29 ‘necessarily presupposes that the subject matter of the reproduction covered by that provision is a protected work, not a counterfeited or pirated work’. (16)
33. Thus, before being entitled to make a reproduction for his private use, the user must have lawfully accessed the work in question. As has been explained, such access does not necessarily have to involve the purchase of a physical medium containing the work. It can take the form of a communication of the work to the public with the copyright holders’ consent. I assume that such access can also take place in the context of one of the exceptions to copyright or related rights laid down in EU legislation. In contrast, access with a view to eligibility for the private copying exception may not be in the context of distribution or communication of the work to the public without the copyright holders’ consent.
34. It is therefore necessary, in the light of these considerations, to examine the conditions in which users access television programmes in the recording service provided by VCAST.
Access to the subject matter of the reproduction in the service provided by VCAST
35. It should be recalled that, according to the description of the service provided by VCAST contained in the request for a preliminary ruling, which is not disputed by the parties, in that service the user selects the television channel and time slot to record on the VCAST website. VCAST then picks up the television signal distributed terrestrially (over the air), with the aid of its own reception systems, and records the time slot selected by the user on the cloud storage service specified by him.
36. In my view, it is therefore clear from this description that the possibility of enjoying the reproduction made by VCAST is certainly not subject to prior access by the user to terrestrial television programmes in Italy. It is thus possible that the user does not have any access to them, possessing neither an antenna nor a television set, and VCAST provides him with access by making the selected programmes available to him. In doing this, it is clear that VCAST does not carry out a full retransmission of programming from Italian television channels. However, this has no bearing on the matter at issue, which does not concern the possibility of watching television in general, but access to programmes reproduced in the service provided by VCAST.
37. The fact, confirmed at the hearing, that the service provided by VCAST is not limited to Italian territory (or, at least, was not at the material time in the main proceedings) corroborates that VCAST is the source of access for its users to the programmes which are the subject matter of the reproduction. Thus, in order to access programmes, users of the service do not even need to be in the Italian terrestrial television catchment area. (17) In other words, VCAST’s service is not limited to persons who actually have access to programmes broadcast on Italian terrestrial television or even to persons who could theoretically access them.
38. It is true that at the hearing the representative of VCAST stated that the service could be limited geographically if necessary. However, the issue is not whether that service is geographically limited or not. Moreover, such limitation could be contrary to, if not the letter, at least the spirit of the internal market rules. (18) Indeed, the mere fact that the service in question can operate outside the catchment area of Italian terrestrial television shows that it is not based on the logic of the private copying exception, as that exception presupposes that the user has prior lawful access to the work which is the subject matter of the reproduction. In the case of this service, it is the reproduction itself that constitutes the only means of access for the user to the work reproduced.
39. So what is the role played by VCAST? The answer is not clear, as its role combines an act of making available and an act of reproduction. I have adopted an interpretation which is favourable to VCAST, allowing room for a private copy made by the user. My assessment is thus as follows.
40. VCAST makes programmes broadcast by Italian television organisations available to its users, which is a form of communication to the public coming under Article 3 of Directive 2001/29. The user accesses the programme by ordering a reproduction of the programme, which will be made in the user’s cloud storage space. While the act of reproduction itself may, in principle, be eligible for the private copying exception, that is not the case for the prior act of making available, which is the source of that reproduction. Accordingly, for any operation to be lawful, the making available must be lawful, as its unlawfulness would exclude the application of the exception. (19)
41. VCAST makes programmes available to its users without the copyright holders’ consent. If the works were normally available on the market for a payment made to the rightholders, like phonograms or videograms, there would be no doubt, in my view, that such making available constitutes an infringement. The present case is distinctive in that it concerns terrestrial television programmes freely accessible to all users in the broadcast catchment area. (20) It is therefore necessary to examine whether this distinctive feature has a significant influence on the approach to the problem.
Protection of rights of free-to-air television organisations
42. I must begin by stating that in my view this question must, for a number of reasons, be answered in the negative.
– The geographical scope of the service
43. As I stated above, the service provided by VCAST, at least at the material time in the main proceedings, was not limited to Italian territory, which is also the catchment area for Italian terrestrial television. Thus, any internet user in the world could request and receive in his cloud storage space a reproduction of a television programme to which he would not have access without the VCAST service. This is in itself sufficient, in my view, to exclude such a service from the scope of the private copying exception. The fact that the programmes are accessible freely and without charge does not affect this conclusion, as that accessibility, and thus any limitation of the copyright holders’ exclusive rights, is restricted to the terrestrial television catchment area and cannot have effects outside that area.
– Protection of broadcasting organisations against infringement of their copyright
44. Irrespective of the geographical scope of the service provided by VCAST, in my view the interpretation of the provisions of Directive 2001/29 which follows from the Court’s case-law precludes a conclusion that the television organisations would be deprived of protection of their copyright by reason of the free accessibility of their programmes.
45. With regard to the right of communication of works to the public (protected by Article 3 of Directive 2001/29), the Court has ruled, relying primarily on the Berne Convention (21) and its explanatory guide, that a communication made by a broadcasting organisation other than the original one must be seen as being made to a public different from the public at which the original act of communication of the work is directed, that is, to a new public. (22) According to the Court, this is because when the author authorises the broadcast of his work, he considers only direct users, that is, the owners of reception equipment who, either personally or within their own private or family circles, receive the programme. However, if reception is for a larger audience, possibly for profit, a new section of the receiving public hears or sees the work. (23)
46. The Court concluded that the retransmission of the television signal to hotel rooms by a hotel manager constitutes a communication to the public requiring the copyright holders’ consent. The Court also held that the hotel’s customers form a new public which, in the absence of the intervention of the manager, although physically within the catchment area of the original broadcast, would not, in principle, be able to enjoy the broadcast work. (24) This position taken by the Court has subsequently been confirmed for other kinds of establishments. (25)
47. I consider that the same holds for a service like that provided by VCAST. That company is undoubtedly an organisation other than the television organisations which make the original broadcasts. The users of the service, whether physically within the catchment area of the original broadcasts or not, therefore form a new public which was not considered by the copyright holders in authorising those broadcasts. Furthermore, the service is provided for profit. (26) It follows that where VCAST makes available television programmes as part of its recording service, this constitutes an infringement of the copyright of television organisations, and possibly of other rightholders, if it is done without their consent.
48. Such making available is also unlawful in the light of the Court’s findings in ITV Broadcasting and Others. (27) In that case, which concerned the retransmission of television programmes over the internet and was therefore similar to the case in the main proceedings, the Court ruled that, by regulating the situations in which a given work is put to multiple use, the European Union legislature intended that each transmission or retransmission of a work which uses a specific technical means must, as a rule, be individually authorised by the author of the work in question. However, given that the making available of works through the retransmission of a terrestrial television broadcast over the internet uses a specific technical means different from that of the original communication, that retransmission must be considered to be a communication within the meaning of Article 3(1) of Directive 2001/29. (28)
49. The Court reached this conclusion even though the provider of the service at issue in that case ensured that those using its service could obtain access only to content which they were already legally entitled to view in the Member State concerned (the United Kingdom) by virtue of their television licence (29) and that, according to the arguments made by that provider, those users could not therefore be regarded as a new public in relation to the public already targeted by the original broadcasts. The Court held that, in the case of the transmission of works included in a terrestrial broadcast and the making available of those works over the internet, each of those two transmissions must be authorised individually and separately by the authors concerned given that each is made under specific technical conditions, using a different means of transmission for the protected works, and each is intended for a different public. In those circumstances, it was no longer necessary to examine the requirement that there must be a new public, which is relevant only in situations where the technical means of communication is the same. (30)
50. In conclusion, the Court ruled that the concept of communication to the public within the meaning of Article 3(1) of Directive 2001/29 must be interpreted as meaning that it covers a retransmission of the works included in a terrestrial television broadcast:
– where the retransmission is made by an organisation other than the original broadcaster;
– by means of an internet stream made available to the subscribers of that other organisation who may receive that retransmission by logging on to its server;
– even though those subscribers are within the area of reception of that terrestrial television broadcast and may lawfully receive the broadcast on a television receiver. (31)
51. The second indent of the preceding point need only be replaced with ‘by means of reproductions made available to the subscribers of that other organisation who may receive that retransmission by logging on to their storage service’ for that case-law to be fully applicable to the present case. It should also be stated that VCAST does not even check that its users are entitled and have the technical means to receive Italian terrestrial television broadcasts.
– The inapplicability of the ‘AKM exception’
52. It is true that the Court’s position seems to have been slightly moderated by the recent judgment in AKM. (32) In that judgment the Court ruled that a simultaneous, full and unaltered transmission of programmes broadcast by the national broadcaster, by means of cables in the national territory, that is to say, by a technical means different from that used for the initial broadcast transmission, does not constitute a communication to the public within the meaning of Article 3(1) of Directive 2001/29, as the public to which that transmission is made cannot be regarded as a new public. (33) However, it would seem that this approach is based on the condition, which must be reviewed by the referring court, that the copyright holders had taken into account the retransmission in question in connection with their authorisation of the initial broadcast. (34)
53. The judgment in question is not entirely clear in this regard. However, any other interpretation would mean that it represents a clear reversal of the rule established in ITV Broadcasting and Others, (35) according to which, where there is a different technical means, the question of the existence of a new public is not relevant. (36) There is nothing in the judgment in question to indicate that the Court intended to make such a reversal.
54. Furthermore, a general rule that the transmission of a work which has already been broadcast by an organisation other than the original broadcaster does not constitute a communication to the public would seem to be contrary to Article 11 bis(1)(ii) of the Berne Convention, which grants authors the exclusive right of authorising ‘any communication to the public … of the broadcast of the work, when this communication is made by an organisation other than the original one’. According to the Court’s settled case-law, the concept of ‘communication to the public’ within the meaning of Article 3 of Directive 2001/29 must be interpreted in conformity with that convention provision. (37)
55. It must be also noted that the judgment in AKM (38) concerns the simultaneous, full and unaltered transmission of programmes broadcast. (39) In the case of such transmission, users may enjoy the programmes in the same conditions as the initial broadcast. However, in the case of a service like that provided by VCAST, they have a digital copy of the programme which they can watch when and as many times as they wish, make reproductions of it and transfer it onto any kind of equipment. This situation is not therefore comparable with AKM. In any event, in the case in the main proceedings, VCAST does not claim to have been given any consent by the copyright holders to make the works broadcast by Italian television organisations available to its users. It cannot therefore rely on AKM. (40)
56. To conclude this section, it is clear in my view, in the light of the Court’s case-law, that the making available of television programmes to users of the service provided by VCAST without the copyright holders’ consent constitutes an infringement of that copyright, even though the programmes are freely accessible and regardless of whether or not such making available is limited to the catchment area for the broadcast of those programmes. The reproduction of the programmes from an unlawful source as part of the same service cannot therefore be eligible for the private copying exception.
The three-stage test
– Preliminary remarks
57. Article 5(5) of Directive 2001/29 introduces a limitation on the Member States’ right to provide in their domestic legislation for the exceptions mentioned in that article, stipulating that such exceptions must be only 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’. That provision has its origin in Article 9(2) of the Berne Convention, which similarly limits the possibility of providing for exceptions to the right of reproduction. (41) This triple condition governing the applicability of the exceptions is commonly known as the ‘three-stage test’ or ‘triple test’.
58. It is true that, according to the Court, Article 5(5) of Directive 2001/29 does not modify the content of the exceptions laid down in that article. (42) However, at the same time the Court ruled that that provision takes effect at the time when the exceptions are applied by the Member States. (43) It can therefore be used as guidance for the interpretation of the exceptions when they are applied in the Member States’ domestic law, but also for the purposes of the interpretation of the provisions of Directive 2001/29 by the Court. Thus, as regards the private copying exception, the Court has ruled that the exception applies only to reproductions made from a lawful source on the basis of Article 5(5) of Directive 2001/29 in particular. (44)
59. Accordingly, account must also be taken of Article 5(5) of Directive 2001/29 in answering the question whether a service like that provided by VCAST may, in the Member States’ domestic law, come under the exception to the right of reproduction based on Article 5(2)(b) of that directive.
– Application in special cases and prohibition of unreasonable prejudice
60. The first and third ‘stages’ of the triple test consist in reviewing whether the exception is applied in special cases which do not unreasonably prejudice copyright holders. Since any exception to the author’s exclusive rights, as a limitation of his rights, unreasonably prejudices him to some degree, this rule requires that the application of a certain exception is limited to situations in which such application is justified by the raison d’être of the exception. That raison d’être alone can justify the prejudice caused by the application of the exception.
61. Although the foundations for the private copying exception stem from various factors, it is quite commonly accepted that its main raison d’être is that it is impossible, or at least very difficult, for copyright holders to control use of their protected works by persons who lawfully access them. Such control could, moreover, constitute an unacceptable interference with the private life of users. (45)
62. That justification does not apply in the case of a service like that provided by VCAST. That service is not limited to the users’ private circles, as the stage prior to the creation of the reproduction, namely the provision of access to television programmes by VCAST, takes place publicly as part of the company’s economic activity and can be easily controlled by copyright holders. There is nothing to prevent those rightholders requiring their consent to be requested for the service or VCAST requiring such consent. The raison d’être for the private copying exception does not therefore justify the prejudice which would be caused to copyright holders by the application of that exception to services like that provided by VCAST.
63. I wish to make clear that VCAST’s situation is different from that of operators that make recording equipment or media available to users or that provide reproduction services. Such equipment, media and services can be used to reproduce protected works, but can also be used for other purposes. In addition, the identity of any reproduced works, and therefore of the rightholders, is not known in advance. It would thus be absurd to require those operators to require the copyright holders’ consent for the sale or leasing of such equipment or the provision of such services. On the other hand, the sole purpose of a service like that provided by VCAST is the making available and reproduction of protected works which are specifically designated in advance (as they are scheduled in the television channels’ programming) and whose copyright holders are known.
64. With regard to copies of works from unlawful sources, the Court has ruled that the application of the private copying exception would unreasonably prejudice copyright holders, as they would have to tolerate acts of piracy in addition to private use of the works by users. (46) Similarly, the application of the private copying exception to services which readily fall within the scope of the normal exclusive rights of rightholders would also unreasonably prejudice them.
– Normal exploitation of the work
65. The assessment of the second stage of the test, which requires that there is no conflict with a normal exploitation of the work, answers the question what prejudice is actually caused to the rightholders.
66. The mere fact that copyright holders are unable to control the exploitation of their works by third parties, on account of the excessively broad definition of the scope of the private copying exception, conflicts with a normal exploitation of the work, as such control, outside the scope rightfully reserved for the user’s private circles, is part of that normal exploitation.
67. Furthermore, recording a television programme makes it possible, first, to watch that programme outside the time slot in which it has been scheduled and, second, to keep a copy in order to watch it again or to transfer it to equipment other than the television set, such as a mobile device. This therefore constitutes an additional service in relation to the initial broadcasting. Television organisations might wish to provide a service of this kind themselves, thereby exploiting works in which they hold the rights and generating additional revenue from them. The fact that this service is provided by VCAST without the consent of those television organisations therefore conflicts with this form of exploitation of the works.
68. In addition, television organisations which broadcast free-to-air programmes are financed mainly by advertising revenue, with the exception of public organisations, which may levy a fee. That revenue is the consideration for the exploitation of the works in which those organisations hold copyright. The broadcast of the works attracts viewers, as a result of which advertisers are willing to purchase broadcast time. As RTI pointed out in its observations, VCAST is in direct competition with those organisations on the advertising market. Because VCAST is exploiting, without consent, works in which those television organisations hold copyright, that competition becomes unfair. To authorise such competition through the private copying exception would necessarily conflict with a normal exploitation of those works.
69. Consequently, the application of the exception laid down in Article 5(2)(b) of Directive 2001/29 to services like those provided by VCAST would not, in my view, comply with the requirements laid down in paragraph 5 of that article.
Final remarks
70. To summarise my remarks concerning the interpretation of the private copying exception in respect of a service like that provided by VCAST, that exception presupposes that the user lawfully accesses the work which is the subject matter of the reproduction. In the service at issue, it is the reproduction itself that gives the user access to the reproduced work. That service therefore constitutes a form of making available of works by its provider. Such making available is unlawful as it is done without the copyright holders’ consent, which excludes the application of the private copying exception. Furthermore, the application of that exception to such a service would be contrary to the requirements laid down in Article 5(5) of Directive 2001/29.
Conclusion
71. In the light of these considerations, I propose that the Court answer the questions referred for a preliminary ruling by the Tribunale di Torino (District Court, Turin, Italy) as follows:
Article 5(2)(b) 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 must be interpreted as precluding national legislation which permits the activity of providing, without the copyright holders’ consent, an online recording service for terrestrial television programmes which are freely accessible in the territory of that Member State, where it is the provider of the service, and not its user, that receives the terrestrial broadcasting signal from which the recording is made.