Yesterday, the European Court of Justice ("ECJ") rendered a ground-breaking decision in case C-462/09 Stichting de Thuiskopie v. Opus. In response to questions of the Dutch Supreme Court, the ECJ answered who must be regarded as the responsible party for the payment of the private copying levy (thuiskopievergoeding) on blank CDs and DVDs in cross-border sales of blank (image or sound) media. To answer this question, the ECJ needed to provide an interpretation of the concept of 'fair compensation' in the Copyright Directive. The ECJ made clear that the Directive imposes an obligation to achieve a result on a Member State that has introduced the private copying exception in its national law. This means that a Member State must guarantee the effective recovery of the fair compensation to remunerate right holders for the use made of their protected works without their permission.

According to article 16(2) of the Dutch Copyright Act, the importer of blank CDs and DVDs has to pay the private copying levy. The German company Opus that sells blank media via websites to Dutch consumers refused to pay this levy. It invoked a clause in its general conditions, in which it formally designates its customers as “importers”. The ECJ, however, ruled that the national law needs to be interpreted in a way that it guarantees the recovery of compensation. As a result, Opus will have to pay the levy, where it is impossible to ensure recovery of the fair compensation from its customers.

This decision has far-reaching consequences; commercial traders cannot for instance escape paying the private copying levy by locating their business in another country. Overall it can be said that this judgment is a great leap forward in protecting the rights of authors by obliging Member States to ensure remuneration.

The winning party Stichting de Thuiskopie, was represented in this matter by Tobias Cohen Jehoram and Vivien Rörsch of De Brauw. Of course, we would be more than pleased to discuss the practical consequences this decision may have for your company.