Judgment of the Court of Justice of November 14, 2024, Reprobel (C-230/23).
1. Facts
The dispute arises in Belgium between Reprobel CV (“Reprobel”), a collective management organization designated by the Belgian government to ensure the collection and distribution of the remuneration provided for under national law for the making of copies of protected works in certain circumstances (such as reproduction for private use), and Copaco Belgium NV (“Copaco Belgium”), a distributor of computer equipment used for reproduction, such as photocopiers and scanners, and therefore subject to the payment of such compensation under Belgian law. Until the end of 2016, Copaco paid Reprobel lump-sum remuneration for the reproduction of protected works.
Following the judgment in the Hewlett-Packard Belgium case (C-572/13), which held that certain aspects of the Belgian system were contrary to Directive 2001/29/EC —because they provided for fixed remuneration unrelated to the actual use of the equipment and lacked corrective mechanisms to prevent overcompensation— Copaco Belgium suspended payment of invoices issued by Reprobel between November 2015 and January 2017. The company invoked the direct effect of the aforementioned Directive and stated that it would not resume payments until Belgian law was brought into line with EU law.
In March 2017, a new equitable compensation system took effect in Belgium, but Reprobel did not resume payments. On December 16, 2020, Reprobel filed a lawsuit and demanded that Copaco Belgium pay the equitable compensation provided for under Belgian law on copyright and related rights for the sale of multifunctional devices and digital media capable of making copies. Copaco Belgium contested that claim, arguing that it was not acting as an end user or as a party obligated to pay, but rather as a mere distributor within the supply chain.
The referring court decided to stay the proceedings and refer several questions to the Court of Justice for a preliminary ruling, concerning whether the direct effect of Directive 2001/29 can be invoked against a collective management organization and whether the national court must set aside legislation that is incompatible with Union law.
2. Statements
The Commercial Court of Ghent (Belgium) referred a question to the Court of Justice for a preliminary ruling, requesting an interpretation of various provisions of Directive 2001/29/EC, in particular Article 5(2)(a) and (b), concerning exceptions and limitations to the right of reproduction and the corresponding equitable compensation.
First, the Court focuses on analyzing the Belgian compensation system and the role and powers of Reprobel within that system. The Court confirms that Belgian law provides for a mixed compensation system, consisting of a fixed (lump-sum) component and a proportional component, paid by the purchasers of reproduction equipment or services, with Reprobel responsible for collecting and distributing these funds.
Next, the Court of Justice examines whether Reprobel, as the only entity authorized in Belgium to collect and distribute equitable compensation for private copying and reprography, has excessive powers with respect to relations between private individuals. It concludes that it does, given that Reprobel is legally empowered to automatically demand payment of remuneration from manufacturers and distributors, as well as to require them to provide the information necessary to identify debtors and the amounts owed, under penalty of criminal sanctions for noncompliance. Furthermore, it may obtain information from customs, tax, and social security authorities, which reinforces its status as an entity endowed with public prerogatives.
Furthermore, the TJ states in its third preliminary ruling that Article 5(2)(a) and (b) of Directive 2001/29/EC allows individuals to invoke before national courts a violation of Union law by an entity such as Reprobel when it acts in the exercise of a public-interest mission endowed with extraordinary powers. In such cases, individuals may challenge the application of national rules that conflict with EU law, given that the entity acts as an extension of the State in fulfilling the obligations arising from Directive 2001/29.
In its fourth preliminary ruling, the Court of Justice notes that the provisions of a directive may have direct effect when they are unconditional and sufficiently precise, allowing individuals to rely on them before national courts against the State in the event of incorrect or non-existent transposition. In this regard, Article 5(2)(a) and (b) of Directive 2001/29 imposes a clear and specific obligation on Member States to ensure fair compensation, without making it subject to further measures. Consequently, national courts must ensure the primacy and full effectiveness of Union law by disapplying conflicting domestic provisions.
The Court of Justice therefore concludes that Article 5, paragraph 2(a) and (b) of Directive 2001/29/EC precludes national legislation that imposes a double fair compensation levy—for private copying and for reprography—on the same equipment or media without distinguishing between the uses justifying each type of levy, as this results in excessive compensation and violates the principles of proportionality and neutrality of the internal market.
In addition, the Court of Justice extends the direct effect of the Directive to cases in which an individual files a claim against the entity that collects fair compensation for acts of reproduction, which means that the national court must set aside the application of national rules that conflict with the Directive when the specific case so requires.
3. Comment
The ruling represents a significant doctrinal advance regarding the direct effect of directives in the field of copyright law, particularly with respect to equitable compensation for exceptions and limitations to the right of reproduction. By affirming that the relevant provisions of Directive 2001/29/EC have direct effect, the Court consolidates a body of case law that allows individuals to invoke European rules directly against collective management organizations acting in the exercise of extraordinary public powers.
From the perspective of European Union law, this ruling underscores the primacy of European law over national regulations that may have incorrectly transposed the exceptions and limitations to copyright. This is particularly critical in systems where equitable compensation is regulated by national laws and administered by entities with special powers, because the CJEU has ruled that such regulations must comply with the scope of the Directive, ensuring respect for the limits imposed by EU law.
Furthermore, the ruling has significant practical implications for companies subject to reproduction royalty obligations; by recognizing that these provisions of the Directive are directly applicable, it provides operators with a legal tool to challenge misaligned or excessive national laws, thereby promoting the harmonization of the internal market and legal certainty in the field of intellectual property.
In summary, the decision strengthens the effective application of EU law regarding copyright and limitations on the right of reproduction by allowing individuals to directly invoke European rules against entities that perform relevant public functions, thereby contributing to greater consistency and uniformity in the application of the exceptions and limitations set forth in Directive 2001/29/EC.
Inés de Casas, Senior Associate, Legal Department