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Online content sharing platforms and intellectual property rights

"Services such as YouTube, TikTok or Twitch are fed by the content uploaded by their users. Traditionally, they were attributed a role of mere intermediaries who were not responsible for what their users uploaded, unless they came to have real knowledge of a specific infraction and do not react to neutralize it. The situation has changed with Directive 2019/790."

This text gathers the main issues debated during the event held in FIDE on March 1, 2022 entitled "Responsibility of online content sharing platforms: legal analysis of the peculiarities of the Spanish transposition of article 17 of Directive 790/2019 in art. 73 of RDL 24/2021”. What is stated below does not express the individual opinion of the speakers, the moderator, or any of the attendees to the event who contributed their point of view during the debate. It is intended to summarize some of the main points of discussion that were discussed.

- YO -

After a long and arduous process, in April 2019 Directive 2019/790 was approved, which regulates copyright in the digital single market. One of its main elements, and one that had given rise to the most discussion during the preparation of the Directive, is the new regime for service providers to share content online.

Services like YouTube, TikTok or Twitch are fed by the content uploaded by their users. Traditionally, they were attributed a role of mere intermediaries who were not responsible for what their users uploaded, unless they came to have real knowledge of a specific infraction and did not react to neutralize it.

The situation has changed. Directive 2019/790 considers that these platforms themselves carry out an act of communication to the public of the content uploaded by their users and have to obtain a license from the rights holders. If they do not obtain it, they will be responsible for that content unless they meet the following requirements: (a) make their best efforts to obtain an authorization from the owners; (b) make, in accordance with strict sectoral standards of professional diligence, their best efforts to guarantee the unavailability of the works and services in respect of which the right holders have provided them with the pertinent and necessary information; and, in any case, (c) act expeditiously upon receipt of a sufficiently reasoned notification from the rights holders, to disable access to the works or other benefits notified or to remove them from their websites, and make their best efforts to prevent them from being uploaded in the future in accordance with letter (b). If all these conditions are met, the provider of the online content sharing service cannot be held responsible if, despite everything, the content remains residually elsewhere on the platform or reappears uploaded to it.

This is the way in which the European legislator has articulated the balance -always delicate- between favoring and recognizing the evolution of society in the digital environment and respect for intellectual property rights. This is what, in the field of Internet services, is called a “safe port”: the service provider is exempt from liability for the activity carried out by its users -in this case, uploading content protected by intellectual property rights - provided that you meet certain requirements. This new safe harbor, it must be remembered, only applies to intellectual property rights; If the users of the platform commit other kinds of infractions (for example in terms of the right to honour, image or publicity rights), the general regulation of the legislation on services of the information society must be followed.

The Directive has been transposed into Spanish Law through article 73 of Royal Decree-Law 24/2021, of November 2. The Spanish legislator has incorporated the regime for service providers to share content online and has reflected the safe harbor with the three requirements mentioned above as (a), (b) and (c).

However, our legislator has not limited himself to incorporating the Directive regime, but has added several pieces that are not in the European text. Two of them were discussed at the session held in FIDE the March 1 of 2022.

– II –

"In relation to live content, online content sharing service providers must disable access to it or remove it from their website during the broadcast of the live event in question.".

The first one refers to live content, and consists of specifying that this type of content must be removed, or its access disabled, during the broadcast of the live event in question. It seems that we are dealing with a clarification of the third step of the safe harbor, the one identified as (c) above: when the service provider receives a sufficiently well-founded notification from the owner, it must act quickly enough to ensure that the content stops being retransmitted in time. real. In theory, rights holders could signal to the service provider in advance that a live event is going to be broadcast, and ask it to make its best efforts to ensure that no retransmission of the event will be available (second phase of the safe harbor, numbered as (b) above). However, by definition, the owners will not be able to provide the service provider with the relevant and necessary information until said content is broadcast; Nor can it be known in advance whether a platform user will retransmit the content until the event takes place.

The Spanish standard has a relatively limited scope. Although the wording could have been more fortunate, it seems to apply only to cases where a user of the platform "broadcasts" a live event. The word retransmission, in the field of intellectual property, has a precise meaning: it is the retransmission of a previous broadcast or transmission, acts that are typically carried out by radio and television organizations. In other words, the Spanish legislator is thinking that the user of one of these platforms retransmits a radio or television signal referring to a live event. The most frequent, although it is not the only imaginable case, is that the content broadcast is a sporting event. The underlying right would, in principle, be that of the radio or television operator that broadcasts or transmits the primary signal. Broadcasting organizations have an intellectual property right over their broadcasts or transmissions and can prohibit the rebroadcasting of them.

There is a debate as to whether the reasons for curbing the retransmission of live events [previously broadcast or transmitted by a broadcasting organization] could also apply to the transmission of live events that the Internet user himself is capturing live through a device. This is certainly an issue that can be addressed. by lege ferenda, but the truth is that the current norm does not contemplate this case: it applies only to retransmission acts and not to direct ones that are generated by the service users themselves.

Finally, it is worth asking whether this provision is necessary and adds a protection that could not be derived from a correct application of the elements that define the safe harbor, in particular, from the obligation that the withdrawal or disabling of access be done in a expeditious after receiving the sufficiently substantiated notification of the holders.

– III –

"Notwithstanding the foregoing, the rights holders may exercise legal actions aimed at reestablishing the patrimonial damage, such as the action of unjust enrichment, in the event that, although the service providers have made their best efforts to eliminate the content unauthorized, it continues to be exploited by them, causing significant harm to the rights holders".

The second piece added by the Spanish legislator in terms of online content sharing providers refers to the fact that, despite having made every effort to eliminate unauthorized content, it continues to be exploited in its service and causes significant damage to holders of rights, they may exercise legal actions aimed at restoring the patrimonial damage, such as the action of unjust enrichment.

It is doubtful if this second piece is only connected with the previous provision of live content, or is projected in general on the activity of providers to share content online.

Certainly, the Spanish law refers to actions that apparently would not be liability actions, such as unjust enrichment, but it uses terms (“property damage”, “damages”) that are typical of the jargon in terms of liability for damages. Given that, in the context of the Directive and the Royal Decree-Law, the relevant damages are those arising from the infringement of intellectual property rights (because that is the only matter in which it is considered from the outset that these platforms themselves an act of communication to the public of the content uploaded by their users), gives the impression that the Spanish legislator intends to ensure the possibility that the owner can claim compensation for damages even if the service provider has done everything he is required to come under the cover of the safe harbor, as if he could be both inside and outside that safe harbor. In addition, in terms of liability for infringements of intellectual property, the European harmonized regulations already contemplate that the offender may be claimed, as a criterion or compensation item, for the profit or benefit obtained as a result of the infringement. Exempting a subject from responsibility in intellectual property, is therefore exempting him from having to deal with that kind of profit. This makes it questionable, from the point of view of compatibility with European law, to try to endorse the provider of the service that deserves the protection of the safe harbor an action linked to the enrichment that he may have experienced.

The action of unjust enrichment is of jurisprudential construction and is not typified in general in our legal system. Its mention could be considered innocuous, as a simple “reminder” that this action exists; however, its mere mention seems to endow it with a certain institutionalization. The unjustified enrichment action is based, among other requirements, on the fact that there is no just cause for the attribution of assets causing the enrichment. But in this case, the European legislator has made a very precise design of the safe harbor for this class of providers: starting from the fact that it cannot be guaranteed one hundred percent that no content not authorized by its owners remains on one of these platforms, if the provider has complied with all the requirements that are set, the Directive has provided that the risk of remaining content is not assumed by the provider. The eventual “enrichment” would therefore be justified.

On the other hand, an expansive interpretation of this provision could have disincentive effects: for the licensees, because they could be less inclined to grant licenses (knowing that in the end they will always be able to recover the damage suffered even if the conditions for applying the safe harbor ); and for the service providers, because they could be reluctant to incur excessive costs to guarantee the unavailability of the contents (if, in the end, even if they make an effort, they will be able to be sentenced to compensate the owners for their damages).

Another balancing formula would have been possible at European level. For example, a fair compensation right could have been established to be paid by platforms to rights holders. However, the consensus reached at Community level did not lead to such a formula. Giving a letter of nature to a residual action of unjust enrichment supposes amending the legislative option that the Union legislator has opted for.

Finally, the Spanish legislator has not bothered to reconcile this matter with the regulation that is already contained in the Intellectual Property Law on co-responsible for the infringement (article 138, second and fourth paragraphs). In particular, in that part of the Intellectual Property Law, the safe harbors of the information society services legislation are left safe, but there is no specific mention of this new safe harbor applicable to providers to share content. online. This adds more uncertainty to the scope of the provision introduced in the Royal Decree-law.

Álvaro bourkaib Fernandez of Cordoba

Cuatrecasas Partner

Article originally published in the Blog Fide in the withfideancel

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