diritto d’autore

AGCOM REGULATION ON COPYRIGHT HELD LAWFUL: REGIONAL ADMINISTRATIVE TRIBUNAL ISSUES VERY RECENT JUDGMENT. THE LAW FIRM LGV AVVOCATI HAS ALREADY DEALT WITH THE ISSUE ON THE 25TH EDITION OF THE PUBLICATION “QUADERNI DI AIDA – IL REGOLAMENTO AGCOM SUL DIRITTO D’AUTORE”.

4/04/2017

With an extremely recent decision dated 30 March 2017, the Regional Administrative Tribunal for Latium rejected the claim for annulment of the regulation adopted by the Communications Authority with resolution no. 680/13/CONS of 12 December 2013 concerning the protection of copyrighted works on electronic communications networks. The issue and the regulation have already been commented by Ms Simona Lavagnini just after its entry into force, in 2014, in the 25th release of the well-known publication “Quaderni di AIDA- Il regolamento Agcom sul diritto d’autore”.


 

AGCOM is the Italian Communications Authority, responsible for supervising the implementation of fair competition among market operators and for protecting fundamental rights in the telecommunications, mass media and editorial sectors. In December 2013, the Authority adopted a Regulation dealing with the protection of copyrighted works made available on electronic communications networks (foremost, the Internet). The most important provisions of the Regulation are those allowing the copyright holder to petition the Authority in cases where his or her digital work has been made available on an Internet page and he or she believes that doing so amounts to an infringement of the Copyright Law. The Regulation then provides for an examination phase involving the service providers and, if possible, the person or entity that has made the content available on the web (i.e. the “uploader”), as well as the administrator of the web page and Internet website. This procedure can either end with the archiving of the case; or, alternatively, where a violation has been found, the Authority can adopt different types of measures such as selective removal of the works, disabling access to said works or disabling access to the Internet website. The innovative powers conferred by the regulation to the Authority brought some Italian scholars to examine in depth the upcoming scenario in the on-line copyright enforcement. The results of said analysis have been published on the 25th release of the well-known publication “Quaderni di AIDA” to which Ms. Simona Lavagnini has actively collaborated.

Shortly after its adoption a claim was put forward before the Regional Administrative Tribunal for Latium by a varied host of consumer and industry associations, who set forth a number of arguments which, summarily, were to the effect that with the adoption of the Regulation the Authority had exercised powers it had not been granted under the law. However, with its decision of 30 March 2017, the Tribunal held that such claim had no basis, for several reasons.

To begin with, it emerged that from a global reading of the applicable norms, the electronic communications providers are – contrary to what had been argued by the petitioners – required to collaborate with the Authority in pursuing copyright infringements carried out on their networks. More precisely, the Tribunal held that: “a systematic reading of the legislation confirms the existence of regulatory and supervising powers which the Authority can exercise with respect to the service providers, also by way of application of measures aimed at ending infringements of the Copyright Law, these being remedies that are concurrent and not substitutive of those conferred on the ordinary legislative authorities” (para. 6.4 of the judgment). Therefore, the Tribunal held that the Communications Authority is indeed the body responsible for monitoring copyright infringements occurring within the context of electronic communication, that it could and should have adopted means of exercising its functions, that it did so with the adoption of the Regulation and that this in no way encroached upon the jurisdiction of the ordinary courts (so-called “judicial and administrative double-track”). Furthermore, the Tribunal found that the adoption of the Regulation complied with the Italian Constitution. The Tribunal explicitly stated that, by adopting the Regulation, the Communications Authority had validly exercised its regulatory powers and, moreover, that the provisions of the Regulation “are not such as to raise any issues of unconstitutionality requiring intervention by the Constitutional Court” (para. 8).

In addition to the above, the Tribunal went on to consider the other points of the claim for annulment of the Regulation. In particular, the Tribunal held that the Authority can also issue blocking orders against infringers of copyrighted digital works, without thereby infringing EU law  (para. 11 of the judgment). It also addressed the claim set forth by the petitioners to the effect that the costs of removals of infringing content entirely fell upon the ISPs, whereas the copyright holder, who could unlimitedly report infringements, incurred no such expenses. The Tribunal was unpersuaded by such argument and rejected it completely, incisively noting that “omitted financial contributions cannot determine a lack of protection [for the copyright holder]” (para. 15 of the judgment). Finally, the Regional Administrative Tribunal found that the Regulation and its provisions complied with EU law, noting especially that the Communications Authority had, as early as September 2013, conveyed to the European Commission the text of the proposed scheme of the Regulation, as required by EU Directive 98/34 (so-called transparency directive). The Commission did indeed submit its own observations and, subsequently, upon receiving the updated version of the Regulation draft in January 2014, stated it had no further comments. Consequently, no issues could be raised with regard to the compliance of the Regulation with EU norms either, and for all those reasons the Tribunal rejected the claim for annulment of the Regulation adopted by the Communications Authority.


SIMONA LAVAGNINI SPEAKS AT THE MICROSOFT WORKSHOP ON THE TOPIC OF SOFTWARE PROTECTION

21/03/2017

On 15 March 2017 Ms. Simona Lavagnini was called on to speak at the SAM&C Workshop organized by Microsoft for its employees at the new offices in Milan. The event focused on the matter of protection afforded to computer programs.


 

The meeting was organized for Microsoft employees and internal collaborators and considered various issues pertaining to software protection and Microsoft programmes. Ms. Lavagnini intervened at the meeting, providing a complete outline of the civil, criminal and administrative legal aspects, considering all matters connected to intellectual property. Software was examined as a fundamentally important asset, protectable under copyright law as well pursuant to the regulations on trademarks and the laws on corporate liability. Specific attention was given to various infringements governed by the law and to the responsibility of intermediaries and the public administration.

FAVOURABLE TAX REGIME PROVIDED UNDER PATENT BOX DECREE ALSO APPLIES TO SOFTWARE UPDATES

14/03/2017

With resolution no. 28/E the Agency responds affirmatively with regard to a query put forward by a computer software company concerning the possibility of applying the favourable tax regime provided under the Patent Box Decree to incomes deriving from activities involving the concession of use of the product, where such activities involve implementation, update, personalization and customization of the software, considering that the norm compulsorily requires the undertaking of research and development activities.


 

Article 1, paras 37 to 45, of the Law of 23 December 2014, no. 190 (so-called “Financial Act 2015”) provides for an optional favourable tax regime (so-called “Patent Box”) for incomes deriving from use of “software protected by copyright, patents, trademarks, designs and models, as well as processes, formulae and information concerning experience acquired in the industrial, commercial or scientific field that are legally protected” with the objective of incentivizing investments in the fields of research and development. This optional regime is regulated by Decree of the Minister for Economic Development, in concert with the Ministry for Economic Development and Finances of 30 July 2015 (so-called “Patent Box Decree”).

A company specialized in software development asked the Italian Revenue Agency for clarifications with regard to the proper identification of activities that may considered favourably from a tax standpoint; in particular, the applicant asked whether it is correct to consider subject to said favourable tax regime the activities involving initial licensing, assistance and maintenance fees, realization of so-called modifications of application software developed by the above mentioned company and registered at the Special Public Register for Computer Programmes held at the SIAE.

The Revenue Agency clarified that software protected by copyright is one of the immaterial assets which allow companies to benefit from the optional favourable tax regime. That includes all computer programs in whichever form they are expressed as long they are the original product of the intellectual creation of the author. Secondly, the Agency confirmed that the activity involving concession of use of the right to utilize immaterial assets is subject to the aforementioned regime; on this point, the Agency emphasized that in order to accede to that regime, in compliance with the so-called “nexus approach”, the company must undertake activities of development, maintenance and enrichment of the software concretely carried out via the implementation, update, personalization and customization of the software. The Agency also specified that activities like staff training, basic help desk of so-called “second level”, telephone support, the periodic fee for use of application software in the cloud, etc. – which involve a purely instrumental use of the software, that fall outside the scope of its protection – do not fall within the favourable tax regime in so far as they do not represent an exclusive use of authorial prerogative.

THE COURT OF ROME RULES IN FAVOR OF SIAE ON THE ANTE CAUSAM PETITION FILED AGAINST SECONDARY TICKETING ACTIVITIES

03/02/2017

The Court partially agreed with the requests made by SIAE in the ante causam petition against the companies Nation 2 S.r.l., Seatwave Lts, Ticketbis Sociedad Limitada and Viagogo AG in relation to the unlawful on line re-sale of Coldplay’s tickets for the concerts scheduled on July 3 and 4, 2017 at San Siro Stadium in Milan.


 

In October 2016 SIAE filed, before the Court of Rome, an ante causam petition to obtain i) the seizure of the website identified with the domain names www.seatwave.it, www.ticketbis.it and www.viagogo.it (including the IP addresses associated with said domain names, present and future), and/or the seizure of the tickets, of the Italian concerts of Coldplay, offered on sale on these web sites for a higher amount than the offer price, as well as ii) preventive measures, against the companies Live Nation 2 S.r.l., Seatwave Lts, Ticketbis Sociedad Limitada e Viagogo AG, consisting in the prohibition to further commercialize, directly or through third parties, the above mentioned tickets – setting a penalty in case of non-compliance with the order.

The action of SIAE, supported by the intervention in the proceedings of Federconsumatori, was aimed at contrasting the “secondary ticketing” phenomenon, a commercial trend according to which the tickets sold by the reseller authorized by the organizers of the events (so called primary re-seller), once bought through the “official channel”, are sold again on the internet on e-commerce web sites for a price that is consistently superior if compared to the price officially proposed on the primary market.

The Court of Rome has declared that the individual and occasional reselling of concert tickets on the secondary market cannot be considered unlawful according to Italian Copyright Law – not even if the price made is consistently superior than the original one or even if the sale is made through on line web sites which are able to make the transaction easier – because of the lack of rules which recognize in favor of the artists the right to obtain an ulterior reward for any successive resale of tickets which entitles spectators to participate to their events. Equally, the role of hosting provider played by the companies involved should have been considered lawful in itself, as it was executed respecting both national and European rules.

That being said, the Court stated that the secondary ticketing activities executed by the companies involved in the proceedings should have been considered unlawful since, in the case in question, the re-sale of the tickets was made professionally and was organized by the same companies which set up the event and/or that managed the e-commerce web sites, implementing lucrative operations placed between primary resellers and end users, consisting in a substantial avoidance of the disposition made in order to protect the economic rights of the authors, causing an economic prejudice both to the authors represented by SIAE and to the end users.

In light of the above, the Court ruled partially granting the requests made by SIAE, issuing the sole preventive measures consisting in the prohibition to further commercialize, directly or indirectly, on the secondary market the Coldplay’s concert tickets, bought on on line and off line primary market, excluding instead the possibility to  grant the seizure as requested. Since the companies involved own web sites as hosting providers, the seizure of the tickets has been declared impossible because the inability to distinguish which tickets were sold through these web sites between end users (and so licitly) or by the owners of the said web sites.

COURT OF JUSTICE OF THE EUROPEAN UNION: AN OPERATOR WHO PROVIDES ACCESS TO A WI-FI NETWORK IS ALSO SUBJECT TO AN OBLIGATION TO PREVENT INFRINGEMENTS OF COPYRIGHT

25/01/2017

A private person operating a Wi-Fi network with internet access, albeit not directly responsible for copyright infringements carried out by third parties, may be ordered to prevent such third parties from making available to the public a certain work or parts of it protected by copyright, if said person has the option of choosing the technical measures necessary for conforming to the injunction, and even where such choice consists in no more than protecting the Internet connection with a password.


 

With judgment of 15 September 2016 in case C-484/14, the Court of Justice of the European Union affirmed, among other things, the principle that a private person operating a Wi-Fi network with internet access may be subject to an order to prevent third parties from making available to the public a certain work protected by copyright, if such person can adopt the technical measures required for conforming to the injunction. The issue becomes relevant when thinking about a private person operating a Wi-Fi network with internet access (in the case scrutinized by the Court it was one Mr. Tobias Mc Fadden) who not only directly takes part in the infringement of a third party copyright (as an “active” service provider, capable of memorizing and re-transmitting the infringing information, would be able to) but also exercises a function of “mere conduit” of information conveyed by others (and therefore enacts a technical, automatic and passive process for the transmission of the required information).

Among the issues submitted to the Court of Justice by the Regional Tribunal I of Munich was that of the interpretation of directive 2000/31, and more precisely whether it should be understood as establishing an impediment for issuing an injunction to obligate a person who provides access to a free Wi-Fi network from stopping third parties who make available to the public, via the Internet connection and on a sharing (peer-to-peer) platform, a specific work or parts of it protected by copyright, when the provider can choose the technical measures required for conforming the injunction. The technical measures suggested by the German Regional Tribunal included shutting down the Internet connection, protecting it with a password and examining all the information conveyed through the connection.

With regard to the technical measures that may be adopted by the network access provider, the Court initially denied that a supervision of the entirety of the conveyed information could be imposed, in that such measure would contrast with the provisions set out in article 15, para. 1, of Directive 2000/31, which, particularly with regard to providers of access to a communication network, prevents the imposition of a general obligation of supervision on conveyed information. With respect to the option of completely shutting down the Internet connection, the Court held that its implementation would result in a serious violation of the Internet access provider’s right to free trade, in so far as the provider would unfairly be prevented from carrying on its activity. However, the Court also held that the provider must adopt adequate measures, having regard to a proper balancing of the relevant fundamental rights (right to free trade, freedom of information and copyright). The technical measures that may be imposed on the service provider must be sufficiently effective to prevent or, at least, make it difficult to carry out infringements of third party copyright of the work being transmitted via the Wi-Fi network. To that end, the measure involving protection of the Internet connection with a password may discourage users of the connection from infringing copyright or related rights, in so far as said users would be obliged to reveal their identity for the purpose of obtaining the password and thus preventing them from proceeding anonymously.

For these reasons, the Court of Justice ruled on the preliminary issue by holding that a private person operating a Wi-Fi network with internet access may be ordered to adopt reasonable technical measures that are necessary for preventing third parties from making available to the public a specific work protected by copyright. However, the Court specified that the technical measures imposed on the Internet connection provider must be evaluated by the judge on a case-by-case.