The matter at hand
Tom Kabinet is a reseller of e-books, offering a ‘reading club’ service that allows members to buy second-hand e-books which have been either purchased by Tom Kabinet or donated to Tom Kabinet free of charge by members of the club. In the latter case, those members must provide the download link in respect of the e-book in question and declare that they have not kept a copy of the e-book. Tom Kabinet then uploads the e-book and places its own digital watermark on it, which serves as confirmation that it is a legally acquired copy.
Initially, membership of the reading club was subject to payment of a monthly subscription fee, after which members could purchase the e-books for a fixed price per e-book. Any e-book provided free of charge by a member resulted in that member being entitled to a discount on the following month’s subscription. At a certain point, payment of a monthly subscription fee ceased to be a membership requirement. Instead, the members of the reading club needed ‘credits’ in order to be able to buy an e-book, which could be purchased or obtained by providing the club with an e-book.
NUV and GAU, associations whose purpose it is to defend the interests of Dutch publishers, brought injunction proceedings before the referring court, the rechtbank Den Haag (district court of The Hague), taking the view that the resale by Tom Kabinet of second hand e-books to members of the reading club constituted an unauthorized act of communication to the public of the e-books within the meaning of Article 3(1) of the Copyright DirectiveDirective 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 referring court disagreed, but was uncertain as to whether the making available, by means of a download link and against payment, of an e-book for use for an unlimited period did constitute an act of distribution for the purposes of Article 4(1) of the Copyright DirectiveDirective 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, and as to whether the distribution right may thus be exhausted within the meaning of Article 4(2) thereof.
The judgment of the ECJ
The ECJ starts by completely ‘reformulating’ the first question of the referring court to the effect that the referring court thereby asks, in essence, whether the supply by means of a download link of an e-book which can subsequently be used for an unlimited period constitutes a ‘communication to the public’ within the meaning of Article 3(1) of the Copyright DirectiveDirective 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, or a ‘distribution to the public’ within the meaning of Article 4(1) thereof (paragraph 34). According to the ECJ, “the crux of that question (…) is whether such supply is subject to the rule on exhaustion of the distribution right provided for in Article 4(2) of that directive or whether, on the contrary, it falls outside such a rule, as expressly provided for in Article 3(3) of the directive in the case of the right of communication to the public” (paragraph 33).
The ECJ considers that this questions cannot be answered having regard to the wording of the relevant provisions alone. In particular, the distinction between ‘the making available to the public of a work in such a way that members of the public may access it from a place and at a time individually chosen by them’ and an ‘act of distribution’ is difficult to make in circumstances such as those in the main proceedings.
The ECJ therefore turns to the WCT, in particular the Agreed Statements concerning Article 6 and 7 thereof, according to which the distribution right exclusively covers “fixed copies that can be put into circulation as tangible objects” (paragraph 40).
The ECJ furthermore refers to the explanatory memorandum in the proposal for the Copyright DirectiveDirective 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, recitals 28 and 29 of the Copyright DirectiveDirective 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 and Art & Allposters (C-419/13), from which it follows that the distribution right relates to the distribution of a work incorporated in a ‘tangible article’ whereas ‘communication to the public’ covers any communication other than the distribution of physical copies which can be put into circulation as tangible objects (paragraph 44).
The ECJ concludes that it follows that “any communication to the public of a work, other than the distribution of physical copies of the work, should be covered not by the concept of ‘distribution to the public’, referred to in Article 4(1) of [the Copyright DirectiveDirective 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], but by that of ‘communication to the public’ within the meaning of Article 3(1)” (paragraph 45), which “should (…) be understood in a broad sense covering all communication to the public not present at the place where the communication originates” (paragraph 49).
As to Usedsoft (C-128/11), in which the ECJ came to a different conclusion regarding the concepts of exhaustion and distribution in the Computer Programs DirectiveDirective 2009/24/EC of the European Parliament and of the Council of 22 May 2001 on the harmonisation of certain aspects of copyright and related rights, the ECJ holds that “an e-book is not a computer program” (paragraph 54), noting that the Computer Programs DirectiveDirective 2009/24/EC of the European Parliament and of the Council of 22 May 2001 on the harmonisation of certain aspects of copyright and related rights is a lex specialis in relation to the Copyright DirectiveDirective 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 and that “the supply of a book on a material medium and the supply of an e-book cannot (…) be considered equivalent from an economic and functional point of view” (paragraph 58).
The ECJ then investigates whether there is a communication to the public in the present case. In this regard, the ECJ recalls, referring to Stichting Brein (C-610/15), that the concept of ‘making available to the public’ relates to any act allowing “members of the public to access the protected work from a place and at a time individually chosen by them, irrespective of whether the persons comprising that public avail themselves of that opportunity” (paragraph 63). The ECJ further points out “that the right of communication to the public is also pertinent when several unrelated persons (members of the public) may have individual access, from different places and at different times, to a work which is on a publicly available website” (paragraph 67), recalling that the concept of ‘public’ requires that account is taken not only of the number of persons able to access the work at the same time, but also of how many of them may access it in succession. The ECJ rules that this number is substantial in the present case “having regard to the fact that any interested person can become a member of the reading club, and to the fact that there is no technical measure on that club’s platform ensuring that (i) only one copy of a work may be downloaded in the period during which the user of a work actually has access to the work and (ii) after that period has expired, the downloaded copy can no longer be used by that user” (paragraph 68).
The ECJ also rules that this public is a ‘new’ public, that is to say, a public that was not already taken into account by the copyright holders when they authorised the initial communication of their work to the public, considering that the making available of an e-book is generally accompanied by a user licence authorising the user who has downloaded the e-book concerned only to read that e-book from his or her own equipment.
On the basis of these considerations, the ECJ concludes that the supply to the public, by means of a download link, of an e-book for permanent use is covered by the concept of ‘communication to the public’ within the meaning of Article 3(1) of the Copyright DirectiveDirective 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.