The Sound of Music: the Court of Justice rules

No communication,
no payment ...

Case C‑162/10, Phonographic Performance (Ireland) Limited v Ireland, Attorney General, was one of two copyright rulings to emanate from the Court of Justice of the European Union this morning.  A reference for a preliminary ruling from the Irish High Court's Commercial Division back in March 2010, this uncontroversial reference seems to have taken rather a long time to hatch out, considering that it doesn't seem to have a vast amount of new law in it.

This dispute broke out over Ireland's Copyright and Related Rights Act 2000, Section 97, which provides:

‘1. Subject to subsection (2), it is not an infringement of the copyright in a sound recording, broadcast or cable programme to cause a sound recording, broadcast or cable programme to be heard or viewed where it is heard or viewed:

(a) in part of the premises where sleeping accommodation is provided for the residents or inmates, and

(b) as part of the amenities provided exclusively or mainly for residents or inmates.

2. Subsection (1) does not apply in respect of any part of premises to which subsection (1) applies where there is a discrete charge made for admission to the part of the premises where a sound recording, broadcast or cable programme is to be heard or viewed.’

PPL, a collecting society, handles copyright in phonogram producers' sound recordings and phonograms in Ireland. PPL sought a declaration that Ireland, in adopting and maintaining in force Section 97, was in breach of European law, plus damages for that breach. Said PPL, it was not permissible to exempt hotels from liability to pay equitable remuneration for the use, in hotel bedrooms, of PPL's phonograms, by means of "apparatus provided by persons responsible for the operation of those hotels" as part of the service they provided. This exemption, said PPL, infringed European copyright directives that entitle phonogram producers to receive equitable remuneration when their phonograms are used in certain circumstances. The Irish High Court also observed that s.97 exempted equitable remuneration in respects of hospitals, nursing homes, residential care facilities and prisons. The High Court then sought guidance on the following questions:

‘(1) Is a hotel operator which provides in guest bedrooms televisions and/or radios to which it distributes a broadcast signal a “user” making a “communication to the public” of a phonogram which may be played in a broadcast for the purposes of Article 8(2) of Codified Directive 2006/115 [the Rental and Lending Right Directive]. …? 

(2) If the answer to paragraph (1) is in the affirmative, does Article 8(2) of Directive 2006/115 … oblige Member States to provide a right to payment of equitable remuneration from the hotel operator in addition to equitable remuneration from the broadcaster for the playing of the phonogram? 

(3) If the answer to paragraph (1) is in the affirmative, does Article 10 of Directive 2006/115 … permit Member States to exempt hotel operators from the obligation to pay “single equitable remuneration” on the grounds of “private use” within the meaning of Article 10(1)(a)? 

(4) Is a hotel operator which provides in a guest bedroom apparatus (other than a television or radio) and phonograms in physical or digital form which may be played on or heard from such apparatus a “user” making a “communication to the public” of the phonograms within the meaning of Article 8(2) of Directive 2006/115 …? 

(5) If the answer to paragraph (4) is in the affirmative, does Article 10 of Directive 2006/115 … permit Member States to exempt hotel operators from the obligation to pay “a single equitable remuneration” on the grounds of “private use” within the meaning of Article 10(1)(a) of Directive 2006/115?’

Today the Court of Justice ruled as follows:

"1. A hotel operator which provides in guest bedrooms televisions and/or radios to which it distributes a broadcast signal is a ‘user’ making a ‘communication to the public’ of a phonogram which may be played in a broadcast for the purposes of Article 8(2) of Directive 2006/115... on rental right and lending right and on certain rights related to copyright in the field of intellectual property.

2. A hotel operator which provides in guest bedrooms televisions and/or radios to which it distributes a broadcast signal is obliged to pay equitable remuneration under Article 8(2) of Directive 2006/115 for the broadcast of a phonogram, in addition to that paid by the broadcaster.

3. A hotel operator which provides in guest bedrooms, not televisions and/or radios to which it distributes a broadcast signal, but other apparatus and phonograms in physical or digital form which may be played on or heard from such apparatus, is a ‘user’ making a ‘communication to the public’ of a phonogram within the meaning of Article 8(2) of Directive 2006/115..... It is therefore obliged to pay ‘equitable remuneration’ under that provision for the transmission of those phonograms.

4. Article 10(1)(a) of Directive 2006/115, which provides for a limitation to the right to equitable remuneration provided for by Article 8(2) of that directive in the case of ‘private use’, does not allow Member States to exempt a hotel operator which makes a ‘communication to the public’ of a phonogram, within the meaning of Article 8(2) of that directive, from the obligation to pay such remuneration.".

Says the IPKat, this ruling confirms that communications by hotel operators owners to hotel bedrooms are communications to the public -- as Case C-306/05 Sociedad General de Autores y Editores de España (SGAE) v Rafael Hoteles SL had previously shown. The Court's view that Ireland was not acting consistently with Article 8(2) of the Rental and Lending Directive in exempting hotels from the right to equitable remuneration for the communication of sound recordings to the public was no great surprise either.

Heartbreak Hotel here and here