Guests entering hotel rooms expect to be able to turn on the TV or listen to the radio. Accordingly, TVs and radios feature in almost any hotel room around the world. However, this commodity has been the trigger for numerous legal disputes in recent years. As always, the quarrel is about money.
In this post we look at proceedings which question whether a hotel in Austria with TV and radio in its rooms is liable to pay remuneration to the competent collecting society or not. Ultimately, this depends on the classification of a hotel room as a place that is “accessible to the public against payment of an entrance fee“. Last week, the Advocate General published his opinion on this matter (C-641/15).
These proceedings originate from a dispute between the Austrian collecting society Verwertungsgesellschaft Rundfunk GmbH and a hotel in Großarl in the federal state of Salzburg. The case revolves around the interpretation of Article 8(3) of Directive 2006/115. In this provision, the term communication to the public is defined with a particular link to the place where the communication occurs. Specifically, the communication has to happen “in places accessible to the public against payment of an entrance fee“. Whether a hotel room can be classified as such a place is the question the Austrian Handelsgericht of Vienna has to decide.
The collecting society argues for qualification of a communication to the public in this case and therefore makes a claim for remuneration. The hotel refuses to pay because they firmly believe a hotel room is not accessed by the public against payment of an “entrance fee”. The Handelsgericht of Vienna submitted two questions regarding the interpretation of Art. 8 (3) of the directive to the European Court of Justice (CJEU) and, in his recently published opinion, the Advocate General Maciej Szpunar presents his point of view in response.
Opinion of Advocate General
According to the Advocate General, the interpretation of the basic term of a communication to the public is clear. The CJEU has ruled in a number of cases on the issues at stake. For instance, the judges have decided that providing a television signal via hotel rooms constitutes a communication to the public within the meaning of Article 3(1) of Directive 2001/29/EC. The Advocate General explicitly mentions the rulings in the cases SGAE (C-306/05) und Phonographic Performance (C-162/10).
However, the definition of the place accessible to the public against payment of an entrance fee may not be so easy to determine. The wording of the provision seems to argue in favor of the point of view of the collecting society but the legislator´s intention must also be kept in mind, this being the Advocate General. The roots of the provision can be traced back to Article 13 d) of the Rome Convention of 26 October 1961. Accordingly, the provision should include all places, where a “fee is levied precisely for the possibility of viewing a television broadcast communicated to the public at that place“. The fee has to be paid for the perception of a program, not for the place itself. The price for a hotel room is paid primarily for the accommodation service and not for the possibility of watching TV or listening to radio. According to Szpunar, TVs and Radios are an additional service comparable with running water, beverages or Wi-Fi access.
Providing TVs and radios in hotel rooms can raise the standard of a hotel and affect the price of accommodation but the price per night has to be seen as an overall price of which the accessibility of TVs and radios is only one of many elements. The bottom line is that the Advocate General denies a communication to the public in the sense of Article 13 d) of the Rome Convention and therefore also in the sense of Article 8 (3) of the directive. A dynamic interpretation of provisions requires excluding hotel rooms of the scope of the exclusive rights of the right holders.
It is good to see that the Advocate General Szpunar does not stop at interpreting the provision according to its wording, but also deepens his analysis to the interpretation in the light of the legislator´s intention. It makes sense to focus on the specific reason behind paying a given entrance fee. However, the courts will probably face difficulties when it comes to services that are less clear in terms of the qualification of the fee. Examples could be background music in spa areas or public gyms.
While based on Art. 8(2) of the Directive 2006/115, not 8(3), judges in a recent decision of the CJEU, (C‑117/15, see our blog post) qualified TVs in a rehab facility as communication to the public . Despite the different provisions, it is reasonable to expect cases that are factually comparable to be treated in the same way. It is up to the European legislator as well as the courts to create legal certainty in this respect and to make sure similar circumstances lead to similar decisions.