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European Court limits private copying levy

By | Published on Monday 25 October 2010

The European Courts moved to limit the extent of the private copying tariff last week in a ruling on a dispute between the Spanish collecting society SGAE and electronics company Padewan.

In most European countries – though not the UK – the music industry applies a levy to certain recordable media or recording devices in return for allowing users to make private copies of records they buy. Most commonly, this levy was applied to the sale of blank cassettes and CDRs and handed over to a relevant collecting society to distribute back to the music community.  

In the digital era, the system has become more complicated as sales of blank cassettes and CDRs have slumped and collecting societies look for other items they can apply the levy to instead, most commonly consumer electronics.

In the case before the European Court last week, SGAE had charged Padewan a levy on all CD, DVD and MP3 players it manufactured. But the electronics firm argued the levy could only be charged when a device was sold to a customer who would likely use the technology for the purpose of private copying, and not indiscriminately on all technology that may or may not be used in the private copying process.

And the European Courts last week concurred. While recognising the legitimacy of the private copying levy in principle, it said that because the levy was to make good for the “harm” of private copying, only the person directly involved in that “harm” should pay. 

Moreover: “The indiscriminate application of the private copying levy to all types of digital reproduction equipment, devices and media, including in the case expressly mentioned by the national court in which they are acquired by persons other than natural persons for purposes clearly unrelated to private copying [is not allowed]”.

Padewan also accused SGAE of applying the private copying levy inconsistently, though the European judges said that was a matter for the national court.