In a landmark decision on hyperlinking, the Court of Justice of the European Union (CJEU) has provided guidance on some features distinguishing legal and illegal hyperlinking in a commercial context.

In the Dutch case of GS Media v Sanoma Media, Sanoma sued GS for allegedly publishing hyperlinks to one of its websites that directed viewers to another website, which featured unauthorised use of copyrighted images. The Dutch Supreme Court referred the question of whether a party could be liable for infringement in such a scenario to the CJEU.

In a two pronged decision the CJEU firstly decided that where hyperlinks are posted without the pursuit of financial gain then it will have to be proved that the poster knew or could reasonably have known the illegal nature of the publication.

Secondly it decided that where hyperlinks are posted for financial gain, there arises a rebuttable presumption that the poster had posted the hyperlink with full knowledge of the illegal nature of the content. In this particular case, GS was unable to rebut that presumption and could, therefore, be liable for infringement.

The decision departed from what was decided in the earlier Svensson case, where the CJEU stated that setting a hyperlink to a freely accessible website featuring copyright works did not constitute "communication" for the purpose of copyright infringement law.

This development is positive as it offers rights holders some protection against commercial websites who post links to unauthorised copies of their works, and also seeks to avoid a regime where internet users who have innocently posted hyperlinks are vulnerable to copyright infringement action.

The interpretation of the extent of circumstances in which a link will be deemed to be posted for financial gain has yet to be explored and will likely be vital in determining the impact of the CJEU's decision.

Businesses should always ensure the legality of any content they link to through their websites to minimise the chances of any potential liability arising.