Thinking Before Linking in the EU

The long awaited verdict in the Svensson case regarding the complicated issue of hyperlinking was recently given by the Court of Justice of the European Union (“CJEU”).  In this article Claes Langenius and Peter Ahlström from the law firm Hammarskiöld & Co provide their comments on the decision.

For better or worse, Sweden has long been in the forefront of technological innovation and the digital copyright discussion.  From the positive side, the technical innovation has spurred Swedish digital online services like Skype, Spotify and Voddler.  On the negative side, innovation has unfortunately also spurred services which are used in direct breach of fundamental copyright principles - two of the most notorious being The Pirate Bay and Swefilmer.com.  Luckily, at least in relation to online music services, copyright holders are step by step managing to counterattack illegal downloading of copyrighted material by offering coveted and legitimate services, such as Spotify.  Innovation, however, brings about the challenge of novelty.  The conflict of laws in the cyberspace remains unsettled in several aspects, whilst the right holders struggling to retain control over their protected works, internet users fight for more access instead of “roadblocks”. 

As the development of digital technology outruns lawmaking, it is in the case law clarifications are pursued.  Therefore, it is hardly surprising that it is the Swedish courts, Svea Court of Appeal in the case of Svensson and Others v Retriever Sverige AB (C-466/12) and the Supreme Court in the case of C Entertainment AB v Sandberg (C-279/13), that are amongst the first to ask the Court of Justice of the European Union (“CJEU”) the contentious question, whether linking to a protected work on the Internet constitutes copyright infringement. 

Hyperlinks – The Basics

Hyperlinks are an intrinsic feature of the Internet establishing interconnectedness between different websites.  A hyperlink redirects the user to another website enabling the user to enjoy third party content.  Contrary to a hyperlink, an embedded link does not redirect the user from the initial website but instead displays (embeds) the third party content, often video clips, on the initial website.  Many website managers, e.g. in the blogosphere, view hyperlinks as praise for the website’s success.  Others have installed technical measures to prevent users from linking to their content or have set up “paywalls”.  There has been a growing confusion about the legal nature of a hyperlink.

Hyperlinking Validated by the Svensson case?

CJEU has recently rendered its much anticipated decision in the Svensson case.  CJEU was asked by the Svea Court of Appeal to elucidate the scope of Article 3(1) of the Information Society Directive (the “Directive”), which provides right holders with the exclusive right to authorise or prohibit transmission of their works to the public.  In essence, CJEU was asked to explain whether hyperlinks to freely available content are permitted. 

The dispute concerned four journalists who wrote and published articles for a major Swedish daily newspaper.  Importantly, the articles were also featured on the newspapers free to access website.  Retriever Sverige AB (“Retriever”), a media monitoring service providing its users with clickable hyperlinks to third party websites, had provided hyperlinks to the articles written by the journalists.  The journalists brought action against Retriever claiming that Retriever’s services amounted to copyright infringement relying on Article 3(1) of the Directive. 

An act of Communication to the Public?

CJEU reasoned that a concept of “communication to the public” requires both “an act of communication” and “a public”.  As the mere provision of clickable links on Retriever’s website enabled its users to view the articles, irrespective of whether they clicked on the links or not, the links must be considered to be making the works available to the public and therefore constitutes an act of communication.  Further, as regards the prerequisite of “a public”, the CJEU stated that since the content of Retriever’s website was aimed at all potential users of the website, Retriever was making communication to the public. 

New Public?

However, in order for the hyperlinks to be regarded as a communication to the public, the communication would have to be directed at a new public, one that was not taken into account by the journalists when they had authorised the initial online publication.  The Court found that as the newspaper website was not subject to any restrictions (i.e. open and accessible to everyone), the initial communication on the newspaper website targeted all potential internet users.  Hence, Retriever did not make the articles available to a new public and so a new authorisation from the journalists was not required.  CJEU emphasised that this conclusion would not be altered if Retriever had instead “framed” or “embedded” the articles on its website giving the impression that the articles were part of Retriever’s website. 

When Hyperlinking Becomes Illegal?

It is important to note that the CJEU also stated that if a hyperlink is designed to circumvent restrictions put in place by the rightholder or site manager to limit public access to their protected work, the link will be considered directed at a new public.  The CJEU stressed that this is the case, in particular, where the work is no longer available to the public on the site on which it was initially communicated or where it is henceforth available only to a restricted public of that website, while being accessible on another Internet site without the copyright holder’s authorisation.

In the wake of Svensson

The clarification that hyperlinking does not constitute copyright infringement as long as it does not reach a new public is indeed a welcome one.  The decision provides some comfort for aggregate sites, but should be followed with caution.  A too hasty decision to provide a link to third party content can be treacherous as the decision does not give carte blanche to linking to any content.  The work that the hyperlink refers to should be freely available on its initial website.  However, CJEU has not defined what constitutes a sufficient “restriction” that right holders are to impose in order to block users from linking to their content and activate the “new public- mechanism”. 

One may for example ask if linking to a website with a poorly implemented technical restriction would be considered unlawful?  Another question is whether terms and conditions on a free to access website can constitute such a restriction by allowing only a certain group of visitors to link, e.g. private not commercial visitors.  One additional complicated issue is whether the CJEU decision allows for providing a link to an infringing content (e.g. unauthorised copy of a picture) where the authorised content (the same picture) is already being published on another website making the content available to all internet users.  Would linking to the infringing content still constitute a communication to a new public?

In practice, before providing a link to a third party website a thorough examination of its content, the intended audience and most importantly the rightholder’s authorisation is indeed necessary – a “think before you link” exercise.  It is not unlikely that an increased use of paywalls and other technical restrictions will emerge as a consequence of the Svensson case.

Even though the decision in the Svensson case certainly has answered some questions, it has likewise paved way for new ones that, together with other lingering queries, are awaited to be answered in C Entertainment as well as in a German case Bestwater Intertnational GmbH v Mebes (C-348/13).  In C Entertainment, the CJEU will look more closely at embedding pay-per-view material on the linking website.  As such embedding technique requires the linking website to circumvent restrictions on the pay-per-view website it is likely that it constitutes copyright infringement, especially in light of the CJEU’s statements in the Svensson case.  Consequently, there are many reasons why thinking should precede the linking.

Claes Langenius, Partner at Hammarskiöld & Co

Peter Ahlström, Associate at Hammarskiöld & Co

Hammarskiöld & Co is a leading Swedish business law firm with an international approach.  The lawyers have broad experience across the range of legal issues that companies can expect to confront on the Swedish market.  The firm’s core practice focuses on Swedish law, but we also offer substantial expertise in advising on and handling the international implications of business law issues. Hammarskiöld & Co’s focus areas are Mergers and Acquisitions, Banking & Finance, EU and Competition law, Dispute Resolution and IP/TMT.

For more information please visit www.hammarskiold.se