What does the CJEU judgment in C-401/19 mean for the national transpositions and applications of Art. 17?

Estoril, Portugal

Earlier this week I had the honour and pleasure of attending the ALAI Congress, which was organized by the Portuguese ALAI group and held in beautiful Estoril.

This year’s conference theme was neighbouring and special rights, but an extraordinary roundtable also found its way into to the programme to discuss the ever-unavoidable copyright topic: Article 17 of the DSM Directive [Katposts here].

During the time at my disposal, I considered the meaning and implications of the recent judgment of the Court of Justice of the European Union (CJEU) in the Polish challenge to Article 17 (C-401/19) [Katposts here] for the national transpositions and applications of that (surviving) provision. 

It is worth noting that, as of today and despite the deadline of 7 June 2021, 8 Member States (Bulgaria, Greece, Cyprus, Latvia, Portugal, Slovenia, Finland, and Sweden) have yet to adopt measures to transpose the DSM Directive into their own laws.

In this post, I will summarize the content of my intervention, which concluded and recommended – along the lines of what I wrote here – a minimalistic approach to the transpositions of Article 17. In other words: a copy-and-paste transposition of Article 17 is to be preferred to too a creative approach.

The CJEU judgment in C-401/19

First things first: while noting that Article 17 introduces “a new liability regime in respect of online content-sharing service providers” (para 20), the CJEU held that para (4) therein is likely to restrict freedom of expression as guaranteed under Article 11 of the EU Charter of Fundamental Rights of the European Union. Nevertheless, such a restriction is justified in light of protecting copyright (para 84).

Crucially, that provision as a whole contains appropriate safeguards: in its judgment, the CJEU identified six key ones, which EU Member States must consider when transposing and applying the resulting national provisions (paras 58 and 85-100).

What the judgment means for national transpositions of Article 17

All the above indicates that Article 17 itself contains a mechanism to ensure that a fair balance between different rights and interests is guaranteed. As a result, the normative content of Article 17 is not to be altered, whether when transposing that provision into national law or when applying the resulting national provision(s). Put it otherwise: if Article 17 contains appropriate safeguards, so do national transpositions that reproduced the text and content thereof.

A key reason for all this is the level of detail of Article 17 itself (probably the longest copyright provision ever found in EU law). While formally belonging to an EU directive, it looks like something else: a provision that one would expect to find an EU regulation. The reason is of course the level and intensity of the discussion that it attracted during the legislative process which, in turn, contributed to making its content more complex and detailed than the original European Commission's proposal.

As I also discuss in this recent article published by Asia Pacific Law Review, national transpositions of Article 17, which incorporated requirements and conditions that are not to be found in the DSM Directive, would alter the equilibrium reached by EU legislature, while also impairing the fundamental objective underlying the adoption of the DSM Directive as a whole: the creation of a digital single market.

One such example relates to the blocking of content pending the resolution of a complaint. The EU text is admittedly silent on this point, though the CJEU – drawing upon its earlier judgment in Glawischnig-Piesczek and substantially in line with the thinking of the European Commission in its Article 17 Guidance – held that OCSSPs “cannot be required to prevent the uploading and making available to the public of content which, in order to be found unlawful, would require an independent assessment of the content by them in the light of the information provided the rightholders and of any exceptions and limitations to copyright” (para 90).

It follows plainly from this part of the ruling that national transpositions that mandate the generalized ex ante blocking of content pending the resolution of a complaint are in breach of EU law. But the same is also true of national transpositions that mandate the blocking of content only ex post.

Similarly, a national transposition that considered – on a statutory basis – certain uses of protected content de minimis and therefore presumed them to be lawful would alter the normative content of Article 17 and the delicate equilibrium that the CJEU judgment identified and mandated Member States to comply with. The same would be true of a national transposition that regarded, on a statutory basis, certain uses to be unlawful per se.

On a side note, it is also worth noting that the CJEU spoke of exceptions and limitations as “user rights”. This was not the first time that the CJEU used this language (think, eg, of the Ulmer judgment), and it is worth acknowledging that the question of what exceptions and limitations actually are vis-à-vis users has given rise to an increasingly important discussion (see here for an excellent example). In my view, as elaborated further here, despite the use of such language, it is inappropriate to consider exceptions and limitations as fully-fledged rights:

• First, in relation to Article 17, the CJEU itself did not attach any specific consequences to the undue blocking of lawful uploads other than the ‘right’ to resorting to the complaint and redress mechanism under Article 17(9).
• Secondly, in its earlier case law (Spiegel Online; Funke Medien), the CJEU held that users are not entitled to invoke directly the application of the EU Charter rights and freedoms lacking a specific copyright exception or limitation at both the EU level and in the applicable national law adopted in compliance with EU law.
• Thirdly, like the rest of the EU framework, the DSM Directive refers to the need to strike a balance between the fundamental rights laid down in the EU Charter (recital 70) but does not refer to the exceptions and limitations in Article 17(7) as ‘rights’ of users.

Another reason not to be too creative: the upcoming DSA

All the above said, there is also another reason why Member States should refrain from being too creative when transposing Article 17 into their own laws. That is the upcoming Digital Services Act (DSA).

Doing the bare minimum ...

The DSA will be a horizontal harmonization effort which will be lex generalis (general law) to the lex specialis (special law) contained in Article 17 of the DSM Directive (see further here in relation to an earlier stage of the legislative process relating to the DSA). 

Albeit that the DSA is adamant that it “is without prejudice to the rules of Union law on copyright and related rights, including … Directive 2019/790/EU”, for what is not specifically covered by Article 17, the general law contained in the DSA will find application instead. Examples that come to mind include:

• The availability of the hosting safe harbour (Article 5 DSA) for situations not covered by Article 17;
• The handling of complaints and the obligations for very large online platforms (Articles 12 and 17 DSA); 
• The transparency obligations for content moderation (Article 13 DSA); 
• The notice-and-action requirements (Article 14 DSA); 
• The treatment of trusted flaggers (Article 19 DSA).

A Member State that went beyond the wording of Article 17 not only would find itself in potential breach of its obligations under EU law insofar as that provision is concerned, but might also have problems once the DSA enters into force.

In sum, and to conclude: doing the bare minimum is normally something that one should not be too proud of. Article 17, however, is anything but normal and ... Member States would be better off doing exactly that.