Broadcasting of football matches

 

Presentation and Comment

 

Ioannis Mournianakis, LL.M. (Heidelberg)

Attorney-at-law

 

 

 

(selection)

76      By these questions, the referring courts ask in essence whether, on a proper construction of Articles 34 TFEU, 36 TFEU and 56 TFEU, those articles preclude legislation of a Member State which makes it unlawful to import into and sell and use in that State foreign decoding devices which give access to an encrypted satellite broadcasting service from another Member State that includes subject-matter protected by the legislation of that first State.

 

85      Article 56 TFEU requires the abolition of all restrictions on the freedom to provide services, even if those restrictions apply without distinction to national providers of services and to those from other Member States, when they are liable to prohibit, impede or render less advantageous the activities of a service provider established in another Member State where it lawfully provides similar services. Moreover, the freedom to provide services is for the benefit of both providers and recipients of services (see Case C-42/07 Liga Portuguesa de Futebol Profissional and Bwin International [2009] ECR I 7633, paragraph 51 and the case-law cited). 

 

89      Consequently, the legislation concerned constitutes a restriction on the freedom to provide services that is prohibited by Article 56 TFEU unless it can be objectively justified. 

 

104    Therefore, if the national legislation concerned is designed to confer protection on sporting events – a matter which it is for the referring court to establish – European Union law does not preclude, in principle, that protection and such legislation is thus capable of justifying a restriction on the free movement of services such as that at issue in the main proceedings. 

 

105    However, it is also necessary that such a restriction does not go beyond what is necessary in order to attain the objective of protecting the intellectual property at issue (see, to this effect, UTECA, paragraphs 31 and 36). 

 

106    In this regard, it should be pointed out that derogations from the principle of free movement can be allowed only to the extent to which they are justified for the purpose of safeguarding the rights which constitute the specific subject-matter of the intellectual property concerned (see, to this effect, Case C 115/02 Rioglass and Transremar [2003] ECR I 12705, paragraph 23 and the case-law cited). 

 

107    It is clear from settled case-law that the specific subject-matter of the intellectual property is intended in particular to ensure for the right holders concerned protection of the right to exploit commercially the marketing or the making available of the protected subject-matter, by the grant of licences in return for payment of remuneration (see, to this effect, Musik-Vertrieb membran and K-tel International, paragraph 12, and Joined Cases C 92/92 and C 326/92 Phil Collins and Others [1993] ECR I 5145, paragraph 20).

 

117    Having regard to the foregoing, it is to be concluded that the restriction which consists in the prohibition on using foreign decoding devices cannot be justified in light of the objective of protecting intellectual property rights.

 

122    FAPL and others and MPS submit, in the alternative, that the restriction at issue in the main proceedings is necessary in order to ensure compliance with the ‘closed period’ rule which prohibits the broadcasting in the United Kingdom of football matches on Saturday afternoons. This rule is stated to have the objective of encouraging the public to attend stadiums to watch football matches, particularly those in the lower divisions; according to FAPL and others and MPS, the objective could not be achieved if television viewers in the United Kingdom were able freely to watch the Premier League matches which broadcasters transmit from other Member States. 

 

123    In that regard, even if the objective of encouraging such attendance of stadiums by the public were capable of justifying a restriction on the fundamental freedoms, suffice it to state that compliance with the aforementioned rule can be ensured, in any event, by incorporating a contractual limitation in the licence agreements between the right holders and the broadcasters, under which the latter would be required not to broadcast those Premier League matches during closed periods. It is indisputable that such a measure proves to have a lesser adverse effect on the fundamental freedoms than application of the restriction at issue in the main proceedings. 

 

124    It follows that the restriction which consists in the prohibition on using foreign decoding devices cannot be justified by the objective of encouraging the public to attend football stadiums.

 

125    In light of all the foregoing, the answer to the questions referred is that, on a proper construction of Article 56 TFEU, that article precludes legislation of a Member State which makes it unlawful to import into and sell and use in that State foreign decoding devices which give access to an encrypted satellite broadcasting service from another Member State that includes subject-matter protected by the legislation of that first State. 

 

134    By Question 10 in Case C-403/08 and Question 8 in Case C-429/08, the referring courts ask, in essence, whether the clauses of an exclusive licence agreement concluded between a holder of intellectual property rights and a broadcaster constitute a restriction on competition prohibited by Article 101 TFEU where they oblige 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. 

 

137    As regards licence agreements in respect of intellectual property rights, it is apparent from the Court’s case-law that the mere fact that the right holder has granted to a sole licensee the exclusive right to broadcast protected subject-matter from a Member State, and consequently to prohibit its transmission by others, during a specified period is not sufficient to justify the finding that such an agreement has an anti-competitive object (see, to this effect, Case 262/81 Coditel and Others (‘Coditel II’) [1982] ECR 3381, paragraph 15).

 

138    That being so, and in accordance with Article 1(2)(b) of the Satellite Broadcasting Directive, a right holder may in principle grant to a sole licensee the exclusive right to broadcast protected subject-matter by satellite, during a specified period, from a single Member State of broadcast or from a number of Member States. 

 

142    Such clauses prohibit the broadcasters from effecting any cross-border provision of services that relates to those matches, which enables each broadcaster to be granted absolute territorial exclusivity in the area covered by its licence and, thus, all competition between broadcasters in the field of those services to be eliminated. 

 

144    Accordingly, given that those clauses of exclusive licence agreements have an anticompetitive object, it is to be concluded that they constitute a prohibited restriction on competition for the purposes of Article 101(1) TFEU.

 

159    Consequently, the answer to the question referred is that Article 2(a) of the Copyright Directive must be interpreted as meaning that the reproduction right extends to transient fragments of the works within the memory of a satellite decoder and on a television screen, provided that those fragments contain elements which are the expression of the authors’ own intellectual creation, and the unit composed of the fragments reproduced simultaneously must be examined in order to determine whether it contains such elements.

 

169    Since in the main proceedings the use of the works at issue is not authorised by the copyright holders, it must be determined whether the acts in question are intended to enable a use of works which is not restricted by the applicable legislation. 

 

170    In this regard, it is undisputed that those ephemeral acts of reproduction enable the satellite decoder and the television screen to function correctly. From the television viewers’ standpoint, they enable the broadcasts containing protected works to be received. 

 

171    Mere reception as such of those broadcasts – that is to say, the picking up of the broadcasts and their visual display – in private circles does not reveal an act restricted by European Union legislation or by that of the United Kingdom, as indeed follows from the wording of Question 5 in Case C-403/08, and that act is therefore lawful. Furthermore, it follows from paragraphs 77 to 132 of the present judgment that such reception of the broadcasts must be considered lawful in the case of broadcasts from a Member State other than the United Kingdom when it is brought about by means of a foreign decoding device. 

 

177    Consequently, those temporary acts of reproduction are not capable of generating an additional economic advantage going beyond the advantage derived from mere reception of the broadcasts at issue. 

 

182    Consequently, the answer to the question referred is that acts of reproduction such as those at issue in Case C-403/08, which are performed within the memory of a satellite decoder and on a television screen, fulfil the conditions laid down in Article 5(1) of the Copyright Directive and may therefore be carried out without the authorisation of the copyright holders concerned.

 

195    In Case C-403/08, the proprietor of a public house intentionally gives the customers present in that establishment access to a broadcast containing protected works via a television screen and speakers. Without his intervention the customers cannot enjoy the works broadcast, even though they are physically within the broadcast’s catchment area. Thus, the circumstances of such an act prove comparable to those in SGAE. 

 

196    Accordingly, it must be held that the proprietor of a public house effects a communication when he intentionally transmits broadcast works, via a television screen and speakers, to the customers present in that establishment.

 

197    That said, in order for there to be a ‘communication to the public’ within the meaning of Article 3(1) of the Copyright Directive in circumstances such as those of the main proceedings, it is also necessary for the work broadcast to be transmitted to a new public, that is to say, to a public which was not taken into account by the authors of the protected works when they authorised their use by the communication to the original public (see, to this effect, SGAE, paragraphs 40 and 42, and the order of 18 March 2010 in Case C-136/09 Organismos Sillogikis Diacheirisis Dimiourgon Theatrikon kai Optikoakoustikon Ergon, paragraph 38). 

 

205    In a situation such as that in the main proceedings, it is indisputable that the proprietor transmits the broadcast works in his public house in order to benefit therefrom and that that transmission is liable to attract customers to whom the works transmitted are of interest. Consequently, the transmission in question has an effect upon the number of people going to that establishment and, ultimately, on its financial results. 

 

207    In light of all the foregoing, the answer to the question referred is that ‘communication to the public’ within the meaning of Article 3(1) of the Copyright Directive must be interpreted as covering transmission of the broadcast works, via a television screen and speakers, to the customers present in a public house. 

 

210    Consequently, the answer to the question referred is that the Satellite Broadcasting Directive must 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.

 

The present cases deals with the screening in English pubs of football-mach broadcasts using a decoder card from another Member State, under the light of the licensing system for the broadcasting of football matches which grants broadcasters territorial exclusivity on a Member State basis. Pursuant to the licence agreement concluded with the Football Association Premier League (FAPL), each TV broadcaster undertakes to encrypt its satellite signal and to transmit the signal, so encrypted, by satellite solely to subscribers in the territory for which it has been awarded with the television broadcasting rights for Premier League matches. Broadcasters are, thus, prohibited from supplying decoder cards to persons who wish to watch their broadcasts outside the Member State for which the licence is granted. The FAPL was seeking to end the practice of using decoder cards from other Member States by means of legal proceedings that ultimately led to the references for a preliminary ruling of the ECJ. In the judgment at hand the European Court of Justice ruled that national legislation which prohibits by criminalising the import, sale or use of foreign decoder cards is contrary to the freedom to provide services and cannot be justified either in light of the objective of protecting intellectual property rights or by the objective of encouraging the public to attend football stadiums. 

In the judgment at hand the Court clearly acknowledges that the specific characteristics of sport must be taken into account when applying provisions of the European law. The Court makes an explicit reference to the new Treaty provision on sport (Article 165 TFEU) in paragraph 102 of the judgment, noting that “the European Union is to contribute to the promotion of European sporting issues, while taking account of the specific nature of sport, its structure based on voluntary activity and its social and educational function”. The judgment of the Court also addresses some important matters that emerge in the present case. The judgment at hand makes it clear that national provisions that criminalise the import, sale or use of decoders or decoder cards from other Member States constitute restrictions of the freedom to provide services of Article 56 TFEU which cannot be justified in light of objectives in the general interest. Moreover, the Court also states that clauses of an exclusive licence agreement concluded between a holder of intellectual property rights and a broadcaster constitute a restriction on competition prohibited by Article 101 TFEU insofar they oblige the broadcaster not to supply decoding devices giving access to that protected content outside the territory covered by the licence agreement concerned. Finally, the judgment clarifies some issues that deal with copyright protection in football and, more specifically, with the interpretation of the Copyright Directive 2001/29/EC. The Court notes that only the opening video sequence, the Premier League anthem, pre-recorded films of matches highlights and various graphics can be regarded as ‘works’ and are therefore protected by copyright. By contrast, the matches themselves are not works enjoying such protection. 

This ruling of the Court was considered by many in England as one that could possibly inflict the FAPL and its lucrative TV rights model a major blow, since the essence of the Court’s judgment was that TV broadcasters cannot stop customers using cheaper foreign satellite TV services to broadcast Premier League matches in England. However, the actual impact of the judgment at hand to the private consumer may in fact be quite limited, since acquiring access to foreign decoder cards usually requires the purchase of additional equipment and decoder devices by the final consumer.

 

Ioannis Mournianakis, LL.M. (Heidelberg)

Attorney-at-law