Bad times for P2P actions in Europe

File sharing through peer-to-peer (P2P) networks, which allows individuals to share copyrighted works without restriction, is one of the most pressing threats faced by the copyright industry. The debate has always focused on whether such file sharing can be deemed legal and whether potential illegality is of a civil or a criminal nature.

Unlike the United States, the European Union has no relevant case law in this regard. Therefore, there is significant legal uncertainty over P2P networks. The situation is even less clear following the preliminary ruling of the European Court of Justice (ECJ) in Promusicae v Telefónica de España and the instructions given by the Spanish public prosecutor regarding the legal consideration of P2P file-sharing activities under criminal law.

The instructions of the Spanish public prosecutor state that, in the absence of any commercial interest, the sharing of copyrighted material through P2P networks should not be prosecuted as a crime. However, the public prosecutor did not state that file sharing should be considered legal - thus, civil liability could result from such activity. Consequently, the public prosecutor deemed that the ordinary sharing of copyrighted material through P2P networks should trigger civil rather than criminal liability.

The ECJ’s preliminary ruling in Promusicae v Telefonica derived from a case before the Spanish courts in which Promusicae, a non-profit organisation of producers and publishers of musical and audiovisual recordings, asked internet service provider (ISP) Telefonica to disclose the identities and addresses of certain individuals to whom it provided internet access services, and whose internet protocol (IP) addresses, date and connection times it knew. According to Promusicae, these individuals used KaZaA, a file exchange program, and provided access to shared phonogram files in which Promusicae’s members held the exploitation rights. The Spanish National Court decided to refer the following question to the European Court:

“Does Community law, specifically Directives 2002/58 (the EU Directive on Privacy and Electronic Communications), 2004/48, 2001/29 and 2000/31 (the EU E-commerce Directive), permit member states to limit to the context of a criminal investigation or to safeguard public security and national defence, thus excluding civil proceedings, the duty of operators of electronic communications networks and services, providers of access to telecommunications networks and providers of data storage services to retain and make available connection and traffic data generated by the communications established during the supply of an information society service?”

The ECJ concluded that Community law does not require member states to lay down an obligation to communicate personal data in order to ensure the effective protection of copyright in civil proceedings.

Although the ECJ stated that in transposing the directives, member states must seek a fair balance in order to protect fundamental rights, the preliminary ruling was vital as the question was referred to the ECJ before the transposition of the EU Privacy and Electronic Communications Directive into Spanish law. In October 2007 the Spanish Act on Privacy and Electronic Communications entered into force, establishing that data corresponding to electronic communications, including the IP addresses of certain electronic communications, must be provided by operators only within the scope of criminal proceedings or investigations. Further, there is no obligation for such data to be provided during civil procedures.

However, this raises the question of how a copyright holder can initiate civil proceedings against individuals that infringe its copyright through P2P networks. Bearing in mind that there is no way to identify the violators without the cooperation of the ISPs - and further, according to the courts and the law, that such intermediaries are not required to provide this data - this leaves few options for copyright holders trying to defend their interests judicially in Spain.

The public prosecutor has already decriminalised P2P file sharing and both Spanish and EU law have made it difficult to initiate legal actions against infringers due to a lack of legal provisions on how to obtain infringers’ identities. The European Union and Spain in particular need to rethink their policies and regulations relating to illegal file sharing, as such activity poses one of the biggest online threats to copyright holders.

This is an Insight article, written by a selected partner as part of IAM's co-published content. Read more on Insight

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