The rental of motor vehicles equipped with radio receivers does not constitute “a communication to the public” in terms of EU copyright law, the Court of Justice of the European Union (CJEU) has recently affirmed. This means that the car hire company is not obliged to pay royalties to the right holder.
EU copyright law harmonises the key rights granted to authors and neighbouring right holders. This includes the exclusive right of authors and neighbouring right holders to authorise or prohibit any communication to the public of their works. Insofar as performers are concerned, this right relates to fixations of their performances.
The issue as to what constitutes “communication to the public” was dealt with by the CJEU within the context of preliminary references made by the Swedish national court in relation to two copyright infringement cases.
The Swedish motor vehicle rental companies, Fleetmanger and NB, hire, directly or through intermediaries, vehicles equipped with radio receivers.
The Swedish organisation which collectively manages copyright in music (STIM), filed an action against Fleetmanager before the national courts, claiming that the car hire company was, through the supply of such vehicles, infringing copyright since it was making musical works available to the public without the required authorisation from the right holders.
Car hire company is not obliged to pay royalties to the right holder
The other dispute related to the filing of an action before the Swedish national courts by the other car hire company, NB, against SAMI, the Swedish organisation managing the related rights of performers. NB sought a declaration from the court to the effect that it was not required, on the basis of the sole fact that the vehicles which it hires are equipped with radio receivers and CD readers, to pay fees to SAMI.
The appellate national court seized of the two cases filed a preliminary reference before the CJEU requesting guidance as to whether the rental of motor vehicles equipped with radio receivers, hence permitting clients to listen to music recordings, constitutes a communication to the public in terms of EU copyright law.
The CJEU affirmed that, in terms of EU law, the mere provision of physical facilities for enabling or making a communication does not in itself amount to “communication”. It went on to emphasise that such an action differs from acts of communication by which service providers intentionally broadcast protected works to their clientele, by distributing a signal via receivers which they would have installed on their premises.
Hence, the Court concluded that the renting out of a vehicle with an integrated radio receiver, which makes it possible to receive, without any additional intervention by the leasing company, the terrestrial radio broadcasts available in the area in which the vehicle is located, does not constitute “an act of communication to the public” of protected works.
Intellectual property rights are a tool whereby individuals or companies investing time and effort in creating innovative material, in various sectors and spheres, are appropriately rewarded. This is why both national and European courts interpret intellectual property laws in such a way as to ensure that no one takes a free ride over investments made by others, by breaching the rights of the intellectual property right holder, be it in relation to a trademark, copyright, patent or design. However, the interpretation to copyright laws given by the CJEU in these two cases, also makes it clear that such rights are not without their own limitations and cannot be interpreted so restrictively as to stunt all other activity.
Mariosa Vella Cardona, freelance legal consultant