On September 8th 2022, the Court of Justice of the European Union issued its ruling in the case between the Federation of the Spanish Digital Industry sector (AMETIC) and Ventanilla Unica Digital (VUD), the Spanish one-stop-shop for the collection and distribution of the private copy levy (C‑263/21).
AMETIC had brought that case before the court hoping for the declaration of the illegality of the one-stop-shop that the collective management organisations for performers, authors, producers, and publishers had set up together to collect and distribute the private copy remuneration in Spain. The court completely dismissed the complaint in a short and unquestionably clear judgment.
While in almost all European member states the collection and distribution of the private copy levy has been running without problems for years via a one-stop-shop set up by the collective management organisations of the different categories of right holders: performers, authors, producers and publishers, in Spain this is only a recent phenomenon.
Until its abolition in abolition in 2016, Spain had financed the private copy remuneration from its General State Budget. In 2017, a royal decree obliged the Spanish CMOs to set up a one-stop-shop (VUD) to organise the collection and distribution of the private copy levy directly with the users. And in 2018 a second royal decree determined the conditions under which VUD had to organise the exemptions and reimbursements to which certain users were entitled (see C‑467/08 Padawan).
AMETIC was of the opinion that the fact that the granting of the exemptions and reimbursements was done by VUD itself constituted a conflict of interest. It considered it unlawful that there is a legal obligation for VUD to consist of the copyright management entities only and claimed that VUD had exorbitant powers, by virtue of which it can demand from applicants for an exemption or reimbursement, specific information on their activities.
This led to a twofold reference for a preliminary ruling by the CJEU.
- Is the composition of a one-stop-shop, as imposed by Spanish law, compatible with Directive 2001/29/EC or, more generally, with the principles of the EU Law?
- Is it compatible with Directive 2001/29/EC or with the general principles of EU Law to grant such one-stop-shop the power of requesting information, including accounting information, from those who apply for the certificate of exemption from the private copying compensation payment obligation?
In its judgment, the CJEU is very short and clear in stating that the exemption and reimbursement are rightly regarded as part of the general task of collecting and distributing the private copy compensation for right holders and that this task can only be assigned to organisations that represent those same right holders and are under their control. The court additionally confirms that this organisation can only perform such task correctly if it has the correct information to check whether an exemption or reimbursement is justified in accordance with the legally determined parameters and that the organisation has no discretion in this regard, but can only perform an objective control of those parameters.
As a result, it rules that:
- The European Copyright framework and the principle of equal treatment must be interpreted as not precluding national legislation under which a legal person established and controlled by intellectual property rights management organisations is entrusted with the management of (i) exemptions from payment in respect of compensation for private copying and (ii) reimbursements in respect of such compensation […].
- The European Copyright framework and the principle of equal treatment must be interpreted as not precluding national legislation which empowers a legal person, which is established and controlled by intellectual property rights management organisations […] to request access to the information necessary for the exercise of the powers of review conferred on it in that regard […].
AEPO-ARTIS welcomes this ruling. “This judgment positively confirms the legality of the model in use in most Member States whereby CMOs of performers and other right holders join forces to provide users with a transparent, user-friendly and non-discriminatory service that allows them to fulfil their obligations towards right holders.” says Ioan Kaes, General Secretary of AEPO-ARTIS.
The Spanish performers’ CMOs also reacted positively. “This decision is great news to improve the development of private copying in Spain. Together with the recently signed agreement with equipment manufacturers and importers to increase levies 50% we are convinced that we can reinforce the efficiency of the management of performer rights” says José Luis Sevillano, General Director of AIE.
“The decision is extremely positive not only for Spanish CMOs, but for all other European CMOs and the right holders they represent. From this decision it is now clear that national legislations in the EU may provide the possibility of CMOs to incorporate a “one-stop-shop”, controlled by such CMOs, for the management of private copy levy, including the exceptions from payments and the eventual reimbursements. And, more importantly, the decision declares that such “one-stop-shop” should be able to carry out verification processes, with no possibly for the manufacturers to refuse access to the corresponding accounting information, alleging the confidentiality of their business accounts.” says José Maria Montes, Director of Legal and International Affairs at AISGE.