The matter at hand

Hewlett-Packard imports into Belgium reprographic devices for business and household use, including ‘multifunction’ devices, the main function of which is the printing of documents.

Reprobel is the collecting society for the fair compensation under the reprography exception, and it informed HP that their printers would – in principle – be subject to  a levy of EUR 49.20 per printer.

Hewlett-Packard was of the opinion that the levy was too high and summoned Reprobel asking the court to rule inter alia that the remuneration which it had paid corresponded to the fair compensation owed pursuant to the Belgian legislation, interpreted in the light 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 Brussels Court of Appeals referred several questions to the ECJ mainly regarding the interpretation of the concept of ‘fair remuneration’ in the context of both the reprography exception and the closely related private copying exception.

The judgment of the ECJ

The ECJ observes that ''while reproductions made by natural persons for private use and for ends that are neither directly nor indirectly commercial’ may come within the scope of both the reprography exception and the private copying exception, whereas reproductions by ‘users other than natural persons’ and reproductions carried out by ‘natural persons for a use other than private use or for commercial purposes’, may only come within the scope of the reprography exception alone'' (paragraph 34).

The referring Court also wants to know whether a part of the fair compensation can be allocated to the publishers of works (if the publishers are under no obligation to let the authors benefit). The ECJ answer is negative: publishers are not right holders and do not suffer any harm from the said exceptions. They cannot, therefore, receive compensation under private copying/reprography exceptions (paragraph 48).

Further, the referring Court requests how to handle with an undifferentiated levy-system which also recovers fair compensation for the copying of sheet music and counterfeit reproductions made from an unlawful source. The ECJ stresses ''that it follows expressly from article 5(2)(a) 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 that sheet music is excluded from the scope of the reprography exception, and that it cannot, therefore, be taken into consideration when calculating fair compensation in the context of that exception'' (paragraph 51). The same applies to the private copying exception; ''were it otherwise, the joint or parallel application of the private copying exception and of the reprography exception by Member States would risk being inconsistent'' (paragraph 52).

With regard to counterfeit reproductions the ECJ reiterates that the private copying exception does not cover the case of private copies made from an unlawful source. The private copying provision cannot be understood as requiring copyright holders to tolerate infringements of their rights beyond the limitation which is provided for expressly. Moreover, it is apparent from 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 that ''the objective of proper support for the dissemination of culture must not be achieved by sacrificing strict protection of rights or by tolerating illegal forms of distribution of counterfeited or pirated works'' (paragraph 59). Furthermore, the ECJ points out that national legislation, which does not draw a distinction according to the (lawful or unlawful) source from which a reproduction for private use is made, may infringe certain conditions laid down by article 5(5) 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 (paragraph 59).

The referring Court also requests clarification whether a national legislation  can combine two forms of remuneration, namely  (i) a lump-sum remuneration (paid prior to the reproduction, when copying devices are put into circulation) and (ii) a proportional remuneration, recovered after the reproduction operation, (determined solely by means of a unit price multiplied by the number of copies produced).

The ECJ observes that the aim of fair compensation is to compensate for the actual harm suffered (paragraph 68). It is ''for the persons who have made the reproductions to make good the harm related to those reproductions by financing the compensation which will be paid to the rightholder'' (paragraph 69). However, the ECJ has acknowledged that, ''given the practical difficulties in identifying users and obliging them to compensate right holders for the harm caused to them, it is open to the Member States to establish a levy chargeable not to the users concerned but to the persons who have the digital reproduction equipment, devices and media and who, on that basis, in law or in fact, make that equipment available to those users or who provide copying services for them and who are able to pass on the cost of the levy to the users'' (paragraph 70). It then considers that it ''is understood that the amount of a levy of that kind, which is fixed in advance, cannot be fixed on the basis of the criterion of actual harm suffered, as the extent of that harm remains unknown at the moment at which the devices concerned are put into circulation on national territory. Accordingly, that levy must necessarily be set as a lump sum'' (paragraph 71).

The ECJ holds that Article 5(2)(a) and Article 5(2)(b) of Directive 2001/29 ''preclude lump-sum remuneration paid prior to the reproduction operation by the manufacturer, importer or intra-Community acquirer at the time at which a device is put into circulation on national territory, in a situation in which the amount of that remuneration is fixed solely by reference to the speed at which that device is technically capable of producing copies'' (paragraph 77).

With regard to the remuneration recovered after the fact, the ECJ finds that ''the harm caused to the author remains the same regardless of whether or not the person liable for payment cooperates in the recovery of such a levy'' (paragraph 79). ''The act of cooperation or non-cooperation cannot therefore constitute an adequate criterion for varying the amount of the levy intended to finance fair compensation after the fact'' (paragraph 80).

The ECJ further points out that a system ''which combines lump-sum remuneration fixed in advance and proportional remuneration fixed after the fact, must contain mechanisms, in particular for reimbursement, which are designed to correct any situation where ‘overcompensation’ occurs to the detriment of particular categories of users. Such ‘overcompensation’ would not be compatible with the requirement that a fair balance be safeguarded between the right holders and the users of protected subject-matter'' (paragraph 86).