Archive for November, 2007

Belgian Court Orders ISPs to Block Illegal File-Sharing

In the first judgement of its kind in Europe, a Belgian Court has ordered an Internet Service Provider (“ISP”) to introduce technical safeguards, blocking peer-to-peer file-sharing software on its network. The judgement is welcomed by music and film officials, who wish to establish an ISP responsibility to monitor and control the network content that they provide access to. Tiscali/Scarlet have lodged an appeal.

Case Summary

SABAM, the Belgian collecting society for authors and composers, initially made an application to the Court for an injunction to block user access to peer-to-peer file-sharing software on the Tiscali/Scarlet network. An interim injunction was granted and an expert appointed to explore the technology available in preventing the infringement of right-holders, through peer-to-peer software. Eleven technical solutions to block such software from the Tiscali/Scarlet network were examined, of which only one (Audible Magic) could provide a specific solution to the problem.

The ISPs continued to argue that they have statutory protection under the E-Commerce Directive. Under this Directive, an ISP (‘mere conduit’) shall not be liable for information transmitted on its network provided they do not:

(1) Initiate the transmission;

(2) Select the receiver of the transmission; and

(3) Select or modify the information contained in the transmission.

However, SABAM contested that as ISPs are aware of, and have the capability to block access to, illegal downloading sites; they should be liable for allowing access to them. SABAM also contested under the Copyright Directive that “Member States shall ensure that rights holders are in a position to apply for an injunction against intermediaries whose services are used by a third party to infringe a copyright or related right”.

Judgement Summary

Whilst the E-Commerce Directive has continued to protect ISPs all over Europe, this judgement identifies and prioritises the Member States responsibility to ensure that under the Copyright Directive “rights-holders are in a position to apply for an injunction against intermediaries whose services are used by a third party to infringe a copyright or related right” i.e. the Court decided that the right of an injunction is greater than the defence under the E-Commerce Directive.

Consequently, Tiscali/Scarlett was ordered to introduce the effective technology [Audible Magic] within six months, subject to a daily penalty fee for delays. In making their ruling, the Court set aside obvious reservations such as cost implications, ability to scale to deal with infringements and the solution’s effectiveness against encryption content. The Court also ruled that introducing such technology does not mean the ISP is monitoring the network, as the filtering technology is ‘automatic’ and other than installing the technology, there is no other active role for the ISP.

Legal Implications

The Belgian Courts have recognised ISPs’ legal responsibility to control access to infringing material made available on their network, through peer-to-peer file-sharing software.

Ultimately, the Directive will continue to defend ISPs as before, shielding them from an obligation to monitor their network content, amongst other things. However, in cases requesting an injunction for the removal or blocking of access to infringing material, ISPs will be under an obligation to act accordingly.

Although this is a judgment of the Belgian Courts, it has potential implications for Europe. As a fellow Member State, this ruling may one day impose a positive duty on all ISPs in the UK, to implement technical measures protecting against infringement.

Commercial Implications

This case highlights the music industry’s current approach to P2P technology, in that the music industry is favouring restricting P2P technology as opposed to seeking ways to licence and monetise the distribution of music on the P2P networks (and it is interesting to note that the BBC has embraced P2P technology to deliver some of its television programmes to users of its own P2P service).

There are some software companies who are currently working towards monetising the sharing of music on P2P networks by way of using advertising revenue to pay the record labels and publishers each time a track is shared. An example of such a company is Qtrax, who are represented by New Media Law LLP.

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