Services - Freedom of movement - Television broadcasting

Football Association Premier League Ltd and others v QC Leisure and others: ECJ (Grand Chamber): Judges Skouris (president), Tizzano, Cunha Rodrigues, Lenaerts, Bonichot, Arabadjiev and Kasel (presidents of chambers), Borg Barthet, Ilesic, Malenovsky (rapporteur) and von Danwitz: 4 October 2011

The Football Association Premier League Ltd (FAPL) ran the Premier League, the leading professional football league competition for football clubs in England. FAPL’s activities included organising the filming of Premier League matches and exercising in their regard television broadcasting rights.

Those rights were awarded to broadcasters under an open competitive tender procedure, which began with the invitation to tenderers to submit bids on a global, regional or territorial basis. Where a bidder won, for an area, a package of broadcasting rights for the live transmission of Premier League matches, it was granted the exclusive right to broadcast them in that area. To protect the territorial exclusivity of all broadcasters, they each undertook, in their licence agreement with FAPL, to prevent the public from receiving their broadcasts outside the area for which they held the licence.

In Greece, the holder of the sub-licence to broadcast Premier League matches was NetMed Hellas. Those matches were broadcast via satellite on SuperSport channels on the NOVA platform. In the UK at the material time the licensee for live premier league broadcasting was BSkyB Ltd. Where a natural or legal person wished to screen Premier League matches in the UK, he had to take out a commercial subscription from that company. However, in the UK certain restaurants and bars had begun to use foreign decoding devices to access Premier League matches.

They bought from a dealer a card and a decoder box which allowed them to receive a satellite channel broadcast in another member state. Those decoder cards had been manufactured and marketed with the authorisation of the service provider, but they were subsequently used in an unauthorised manner, since the broadcasters had made their issue subject to the condition that customers did not use them outside the national territory concerned. FAPL had taken the view that such activities were harmful to its interests because they undermined the exclusivity of the rights granted by licence in a given territory and hence the value of those rights.

Consequently, FAPL and others brought, in case C-403/08, what they considered to be three test cases before the Chancery Division of the High Court of England and Wales. Two of the actions were against QC Leisure, R, AV Station and C, suppliers to public houses of equipment and satellite decoder cards that enabled the reception of programmes of foreign broadcasters, including NOVA, which transmitted live Premier League matches.

The third action was brought against M, SR Leisure Ltd, H and O, licensees or operators of four public houses that had screened live Premier League matches by using a foreign decoding device. In case C-429/08, MM, manager of a public house, procured a NOVA decoder card to screen Premier League matches. Agents from MPS, a body mandated by FAPL to conduct a campaign of prosecutions against public house managers using foreign decoding devices, found that MM was receiving, in her public house, broadcasts of Premier League matches transmitted by NOVA.

Consequently, MPS brought MM before the magistrates’ court, which convicted her of two offences under section 297(1) of the Copyright, Designs and Patents Act on the ground that she had dishonestly received a programme included in a broadcasting service provided from a place in the UK with intent to avoid payment of any charge applicable to the reception of the programme. After the Crown court had essentially dismissed her appeal, MM brought an appeal by way of case stated before the High Court. In those circumstances, the High Court made a reference for a preliminary ruling to the European Court of Justice.

The questions were whether: (i) ‘illicit device’ within the meaning of article 2(e) of Council Directive (EC) 98/84 (on the legal protection of services based on, or consisting of, conditional access) (the conditional access directive) had to be interpreted as also covering foreign decoding devices, including those procured or enabled by the provision of a false name and address and those used in breach of a contractual limitation permitting their use only for private purposes; (ii) article 3(2) of the conditional access directive precluded national legislation which prevented the use of foreign decoding devices, including those procured or enabled by the provision of a false name and address or those which had been used in breach of a contractual limitation permitting their use only for private purposes; (iii) on a proper construction of articles 34, 36 and 56 of the Treaty on the Functioning of the European Union (TFEU), those articles precluded legislation of a member state which made it unlawful to import into and sell and use in that state foreign decoding devices which gave access to an encrypted satellite broadcasting service from another member state that includes subject-matter protected by the legislation of that first state; (iv) the clauses of an exclusive licence agreement concluded between a holder of intellectual property rights and a broadcaster constituted a restriction on competition prohibited by article 101 of the TFEU where they obliged the broadcaster not to supply decoding devices giving access to that right-holder’s protected subject-matter outside the territory covered by the licence agreement concerned; (v) article 2(a) of Council Directive (EC) 2001/29 (on the harmonisation of certain aspects of copyright and related rights in the information society) (the copyright directive) had to be interpreted as meaning that the reproduction right extended to the creation of transient sequential fragments of the works within the memory of a satellite decoder and on a television screen which were immediately effaced and replaced by the next fragments.

In that context, the referring court was uncertain, in particular, whether it had to conduct its appraisal by reference to all the fragments as a whole or only by reference to those which existed at a given moment; (vi) whether acts of reproduction such as those at issue in case C-403/08, performed within the memory of a satellite decoder and on a television screen, fulfilled the conditions laid down in art 5(1) of the copyright directive and, therefore, whether those acts might be carried out without the copyright holders’ authorisation; (vii) ‘communication to the public’ within the meaning of article 3(1) of the copyright directive had to be interpreted as covering transmission of the broadcast works, via a television screen and speakers, to the customers present in a public house; (viii) Council Directive (EEC) 93/83 (on the coordination of certain rules concerning copyright and rights related to copyright applicable to satellite broadcasting and cable retransmission) (the satellite broadcasting directive) had a bearing on the lawfulness of the acts of reproduction performed within the memory of a satellite decoder and on a television screen.

The Court ruled: (1) ‘Illicit device’ within the meaning of article 2(e) of the conditional access directive had to be interpreted as not covering foreign decoding devices (devices which gave access to the satellite broadcasting services of a broadcaster, were manufactured and marketed with that broadcaster’s authorisation, but were used, in disregard of its will, outside the geographical area for which they had been issued), foreign decoding devices procured or enabled by the provision of a false name and address or foreign decoding devices which had been used in breach of a contractual limitation permitting their use only for private purposes (see [67] of the judgment).

(2) Article 3(2) of the conditional access directive did not preclude national legislation which prevented the use of foreign decoding devices, including those procured or enabled by the provision of a false name and address or those used in breach of a contractual limitation permitting their use only for private purposes, since such legislation did not fall within the field coordinated by that directive (see [74] of the judgment).

(3) On its proper construction article 56 of the TFEU precluded legislation of a member state which made it unlawful to import into and sell and use in that state foreign decoding devices which gave access to an encrypted satellite broadcasting service from another member state that included subject-matter protected by the legislation of that first state; that conclusion was affected neither by the fact that the foreign decoding device had been procured or enabled by the giving of a false identity and a false address, with the intention of circumventing the territorial restriction in question, nor by the fact that it was used for commercial purposes although it was restricted to private use (see [125] of the judgment).

(4) The clauses of an exclusive licence agreement concluded between a holder of intellectual property rights and a broadcaster constituted a restriction on competition prohibited by article 101 of the TFEU where they obliged the broadcaster not to supply decoding devices enabling access to that right holder’s protected subject-matter with a view to their use outside the territory covered by that licence agreement (see [146] of the judgment).

(5) Article 2(a) of the copyright directive had to be interpreted as meaning that the reproduction right extended to transient fragments of the works within the memory of a satellite decoder and on a television screen, provided that those fragments contained elements which were the expression of the authors’ own intellectual creation, and the unit composed of the fragments reproduced simultaneously had to be examined in order to determine whether it contained such elements (see [159] of the judgment).

(6) Acts of reproduction, such as those at issue in case C-403/08, which were performed within the memory of a satellite decoder and on a television screen, fulfilled the conditions laid down in article 5(1) of directive 2001/29 and might therefore be carried out without the authorisation of the copyright holders concerned (see [182] of the judgment).

(7) ‘Communication to the public’ within the meaning of article 3(1) of the copyright directive had to be interpreted as covering transmission of the broadcast works, via a television screen and speakers, to the customers present in a public house (see [207] of the judgment).

(8) The satellite broadcasting directive had to be interpreted as not having a bearing on the lawfulness of the acts of reproduction performed within the memory of a satellite decoder and on a television screen (see [210] of the judgment).