The European Court of Justice has ruled in a case that had wide reaching implications for hosting providers. Netlog a social networking site that allowed users to upload content was defending itself against SABAM a Belgium based copyright collecting society.
SABAM was looking to ensure pro-active filtering systems were in place that would block all unauthorised file sharing between peers, rather than what most responsible sites do currently, which is to react to notices from copyright holders when they spot their material being used without permission.
"The owner of an online social network cannot be obliged to install a general filtering system, covering all its users, in order to prevent the unlawful use of musical and audio-visual work Such an obligation would not be respecting the prohibition to impose on that provider a general obligation to monitor nor the requirement that a fair balance be struck between the protection of copyright, on the one hand, and the freedom to conduct business, the right to protection of personal data and the freedom to receive or impart information, on the other"Extract from Court of Justice of the European Union Press Release
The case has been running since 2009, when SABAM tried to make it unlawful for Netlog to continue operating as it had, and for every day it was making available works without permission from SABAM to be fined €1000 a day.
General filtering systems are difficult to produce and run, and even if copyright holders providd digital signatures against which material can be checked, uploaders can change bit rates and codecs of material to bypass these sort of automated checks, or at the simplest level just name the file something else. It is this ease with which automated systems can be bypassed that would have meant that a system that would work reliably would be prohibitively expensive or require large amounts of human interaction to verify material.
The European Court is trying to balance the rights of the copyright holders, and the freedom for sites like NetLog to conduct business along with the privacy of users of a service. In cases where a host does not remove material that clearly infringes copyright upon a reasonable request, or pro-actively seeks the material itself and promotes it to site visitors then the situation is likely to be different.
This ruling follows on from the SABAM versus Scarlet ruling in November 2011, that ruled that internet service providers cannot be be asked to filter Internet content for copyright enforcement purposes, the requests for filtering contravening the e-commerce directive, as well as the fundamental rights of European citizens.
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