CJEU clarifies, in Copydan Båndkopi v. Nokia, that Nokia is obliged to pay DKK 14.8 million in private copying levies

On 5 March 2015, the Court of Justice of the European Union (CJEU) published its decision in Case C 463/12, Copydan Båndkopi v. Nokia Danmark A/S, following a request for a preliminary ruling from the Østre Landsret (Denmark), concerning the interpretation of Articles 5(2)(b) and 6 of EU Directive 2001/29/EC. 

In a nutshell, Copydan Båndkopi asked Nokia to pay a private copying levy for the reproduction of music and videos over memory cards for mobile phones imported and marketed in Denmark between 2004 and 2009. Litigation ensued over Nokia’s refusal. 
 
Following the Advocate General’s Opinion (IFRRO reported about it here), the CJEU now decided as follows:
 
1. Article 5(2)(b) of Directive 2001/29/EC does not preclude national legislation which provides that fair compensation is to be paid, in respect of multifunctional media such as mobile telephone memory cards, irrespective of whether the main function of such media is to make such copies, provided that one of the functions of the media – be it merely an ancillary function – enables the operator to use them for that purpose. However, in so far as the prejudice to the rightholder may be regarded as minimal, the making available of such a function need not give rise to an obligation to pay fair compensation.
2. Article 5(2)(b) of Directive 2001/29 does not preclude national legislation which makes the supply of media that may be used for copying for private use, such as mobile telephone memory cards, subject to the levy, but does not make the supply of components whose main purpose is to store copies for private use, such as the internal memories of MP3 players, subject to that levy, provided that those different categories of media and components are not comparable or the different treatment they receive is justified. 
3. Article 5(2)(b) of Directive 2001/29 must be interpreted as not precluding national legislation which requires payment of the levy intended to finance fair compensation by producers and importers who sell mobile telephone memory cards to business customers and are aware that those cards will be sold on by those customers but do not know whether the final purchasers of the cards will be individuals or business customers, on condition that:
the introduction of such a system is justified by practical difficulties;
the persons responsible for payment are exempt from the levy if they can establish that they have supplied the mobile telephone memory cards to persons other than natural persons for purposes clearly unrelated to copying for private use;
the system provides for a right to reimbursement of that levy which is effective and does not make it excessively difficult to repay the levy and only the final purchaser of such a memory card may obtain reimbursement by submitting an appropriate application to that organisation.
4. Article 5(2)(b) of Directive 2001/29, read in the light of Recital 35, must be interpreted as permitting the Member States to provide, in certain cases covered by the exception to the reproduction right for copies for private use, for an exemption from the requirement under that exception to pay fair compensation, provided that the prejudice caused to rightholders in such cases is minimal. That threshold must, inter alia, be applied in a manner consistent with the principle of equal treatment. 
5. Directive 2001/29 is to be interpreted as meaning that, where a Member State has decided, pursuant to Article 5(2), to exclude, from the scope of that provision, any right for rightholders to authorise reproduction of their works for private use, any authorisation given by a rightholder for the use of files containing his works can have no bearing on the fair compensation payable under Article 5(2)(b), for reproductions made with the aid of such files; it cannot, of itself, give rise to an obligation on the part of the user of the files concerned to pay remuneration to the rightholder.
6. The implementation of technological measures under Article 6 of Directive 2001/29 for devices used to reproduce protected works, such as DVDs, CDs, MP3 players and computers, can have no effect on the requirement to pay fair compensation in accordance with the exception to the reproduction right in respect of reproductions made for private use by means of such devices. However, the implementation of such measures may have an effect on the actual level of the compensation.
7. Directive 2001/29 precludes national legislation which provides for fair compensation, in accordance with the exception to the reproduction right, in respect of reproductions made using unlawful sources, i.e. from protected works which are made available to the public without the rightholder’s consent.
8. Directive 2001/29 does not preclude national legislation which provides for fair compensation in respect of reproductions of protected works made by a natural person by or with the aid of a device which belongs to a third party.
 
The complete decision of the CJEU is available here