The storage of content in the cloud falls within the scope of the private copying exception under the Directive (2001/29) on certain aspects of copyright and neighbouring rights in the information society, the Court of Justice of the European Union ruled on Thursday 24 March (Case C-433/20).
Austro-Mechana, the Austrian copyright collecting society, is challenging the decision of the Vienna Commercial Court rejecting its claim for payment of copyright remuneration under the private copying exception to the cloud storage service provider, Strato.
The EU Directive allows reproductions of a work made on any medium by a natural person and for private use, as an exception to the exclusive right of authors to authorise or prohibit the reproduction of their works.
In its judgment, the Court held that the private copying exception applies in this case. It states that making a backup copy of a work by uploading it to a cloud storage space constitutes a reproduction of that work. And the use of the cloud is a way of copying a work from all existing media.
It is not decisive whether the storage device belongs to a third party. Since one of the objectives of Directive 2001/29 is to prevent copyright protection in the European Union from becoming outdated or obsolete as a result of technological developments, this objective would be undermined if the exceptions and limitations to copyright protection were interpreted in such a way as to exclude digital media and cloud computing services, the Court said.
On the payment of fair compensation, the European Court considers that the obligation of a cloud storage service provider to pay fair compensation falls within the margin of appreciation granted to the national legislator. Member States, which implement the private copying exception, are required to provide for a system of fair compensation intended to compensate rightholders.
In principle, it would be up to the person making the private copy to finance the compensation. However, because of the practical difficulties in identifying the end-users of cloud storage services, the Court considers that Member States may introduce a private copying levy chargeable to the producer or importer of the servers by means of which the cloud computing services are offered to natural persons. That levy will then be passed on to the purchaser of such servers and ultimately borne by the private user who uses the equipment.
However, the Directive does not preclude national legislation that does not make the providers of cloud storage services subject to the payment of fair compensation, in so far as that legislation provides for the payment of fair compensation in some other way.
See the judgment: https://aeur.eu/f/xm (Original version in French by Mathieu Bion)