R and Others v Secretary of State for Culture, Olympics, Media and Sport BPI (British Recorded Music Industry) Ltd and Others (Interested Parties)
| Jurisdiction | England & Wales |
| Judge | Mr Justice Kenneth Parker |
| Judgment Date | 20 April 2011 |
| Neutral Citation | [2011] EWHC 1021 (Admin) |
| Court | Queen's Bench Division (Administrative Court) |
| Docket Number | Case No: CO/7354/2010 |
| Date | 20 April 2011 |
[2011] EWHC 1021 (Admin)
IN THE HIGH COURT OF JUSTICE
QUEEN'S BENCH DIVISION
ADMINISTRATIVE COURT
Royal Courts of Justice
Strand, London, WC2A 2LL
Mr Justice Kenneth Parker
Case No: CO/7354/2010
The Queen (on the Application of)
and
and
Antony White QC and Kieron Beal (instructed by BT Legal and Talk Talk Legal) for The Claimants
James Eadie QC, Robert Palmer and Alan Bates (instructed by The Treasury Solicitor) for The Defendant
Pushpinder Saini QC and James Strachan (instructed by Wiggin LLP) for The Interested Parties
Hearing dates: 23, 24, 25 and 28 March 2011
Introduction
This is an application for judicial review in which it is claimed that the online infringement of copyright provisions ("the contested provisions") of the Digital Economy Act 2010 ("the DEA 2010") and the Copyright (Initial Obligations) (Sharing of Costs) Order 2011, currently laid before Parliament ("the draft Costs Order") are incompatible with a number of provisions of EU law. Permission was granted by Wyn Williams J on 10 November 2010.
The First Claimant, British Telecommunications Plc ("BT"), is a public limited company incorporated under the laws of England and Wales. The Second Claimant, TalkTalk Telecom Group Plc ("TTG"), is also a public limited company incorporated in England. Each carries on business in the supply of telecommunications services and equipment to both businesses and residential customers. Both BT and TTG are also internet service providers ("ISPs").
The Defendant ("the Secretary of State") is the Government minister designated with responsibility for the Department for Business, Innovation and Skills ("DBIS").
There are ten Interested Parties. These are organisations and associations concerned with the protection of copyright in works belonging to their members whom they represent. They also include unions whose members are employed in the creative industries, and their employers. There are also two interveners, Consumer Focus ("CF") and Article 19. CF is the National Consumer Council in England and Wales, with statutory duties to represent the interests of consumers and to advise the Government and regulators on consumer matters. Article 19, the Global Campaign for Free Expression, a charity registered in the UK, is an international human rights organisation concerned with protecting and promoting the right to freedom of expression.
The Claimants advance five grounds of challenge in respect of the contested provisions. They contend that:
i) The provisions constitute a technical regulation and/or a rule on services within the meaning of the Technical Standards Directive (Directive 98/34/EC of the European Parliament and of the Council of 22 June 1998 laying down a procedure for the provision of information in the field of technical standards and regulations, OJ [1998] L No 204, as amended by Directive 98/48/EC of the European Parliament and of the Council of 20 July 1998, OJ [1998] L No 217). The provisions, it is said, should have been notified to the EU Commission in draft, but were not. The provisions are accordingly unenforceable.
ii) They are incompatible with certain provisions of the Electronic Commerce Directive ("the E-Commerce Directive") ( Directive 2000/31/EC of the European Parliament and of the Council of 8 June 2000 on certain legal aspects of information society services, in particular electronic commerce, in the Internal Market, OJ 2000 L No 178).
iii) They are incompatible with certain provisions of the Privacy and Electronic Communications Directive ("the PEC Directive") ( Directive 2002/58/EC of the European Parliament and of the Council concerning the processing of personal data and the protection of privacy in the electronic communications sector, OJ [2002] L No 201).
iv) They are disproportionate in their impact on ISPs, consumers, business subscribers and public intermediaries. The requirement for the legislation to be proportionate in its impact on ISPs, businesses and consumers is said to be derived from a number of sources, including Articles 7, 8, 11 and 52 of the Charter of Fundamental Rights and/or general principles of EU law, pursuant to Article 6 TEU and the Human Rights Act 1998 and Articles 8 and/or 10 of the European Convention on Human Rights.
v) They infringe the Authorisation Directive ( Directive 2002/20/EC of the European Parliament and of the Council on the authorisation of electronic communications networks and services OJ [2002] L No 108, as amended by European Parliament and EC Council Directive 2009/140, OJ [2009] L 337).
The Claimants also seek to challenge the draft Costs Order on each of grounds 2 to 5 above (the Order having been notified in draft to the EU Commission, ground 1 was not applicable).
Factual Background
The framework within which ISPs operate
The Claimants operate within a framework of measures known as the "telecoms package". This includes five European Directives which set out the major provisions governing the "telecoms package". These were introduced by the EU to harmonise the cross-border provision of telecommunications services within the internal market.
The Office of Communications Act 2002 and the Communications Act 2003 ("CA 2003") led to a major re-organisation of telecommunications markets in the United Kingdom, under the regulatory control of Ofcom. The regulation at both an EU and a national level has been designed to promote competition between telecommunications providers and protect consumer interests, while ensuring that a universal service is available for the majority of telecommunications services (access to landline telephony, mobile phone telephony and internet access).
The Claimants each provide an "information society service" (as defined in the E-Commerce Directive: see paragraph 96 below). For the relevant purposes of these proceedings, they do so as mere "conduit" ISPs. As such each ISP gives access to an electronic communications network to its own subscribers. A conduit is not allowed to interfere with traffic. In that capacity, it has neither knowledge of, nor control over, the information which is transmitted by subscribers. Its actions are merely "technical, automatic and passive": see Joined Cases C-236/08 to C-238/08 Google France SARL v Louis Vuitton Malletier SA [2010] ECR 1–0000, ECJ, at [110], [113] and [114].
Background to the relevant legislation
(a) Memorandum of Understanding
Software developers have created file-sharing software enabling an internet user on one computer to access files and material stored on another user's computer where the second user is also connected to the internet (peer-to-peer or "P2P" software). P2P services enable an internet user to search for files being offered by other users who are connected to the same and sometimes other P2P services, and to request and receive copies of these files on his or her computer, and make these files available for further distribution to other users of P2P services over the internet, transmitting exact copies of files from his or her computer to another user's computer. Individuals who make available and communicate files using P2P services store these files in directories on their computers that they open to other internet users to view and access. In this way a copyright work such as a sound recording or film can be stored in the form of a digital file in the shared directory, and that file can be made publicly available to vast numbers of other P2P users who are able to search for the file and, on request, transfer copies of that file over the internet to others. At any time there may be hundreds of thousands of individuals accessing a P2P service, many of them doing so unlawfully by infringing copyright in the relevant work.
Music is a popular target of P2P file sharing. The arrival of MP3 software in the late 1990s enabled the conversion of digitally recorded (or remastered) music into highly compressed computer files. As a matter of history it appears that Napster Inc, in the United States, was the first to exploit the opportunities for music sharing opened up by P2P technology, but the early means that it employed exposed it to a successful claim for copyright infringement and led to its demise, without deterring more sophisticated successors. It should be stressed that P2P software may be used for legitimate purposes, such as sharing photographs between family and friends and transferring digital media files between a desk top and a lap top computer owned by the same individual or family.
In order to combat the increase in unlawful file-sharing, BT, TTG and other ISPs were encouraged by the Government to enter into a Memorandum of Understanding ("MOU") with the BPI (British Recorded Music Industry) Limited ("BPI") and other rights owners in July 2008. ISPs undertook to work together with other signatories in an experimental trial in which internet service customers were informed if their accounts were being used to share copyright material unlawfully and were advised how to address such infringements. The Claimants participated in such a trial for three months.
The MOU was intended to improve communication and...
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