SSRN Id3810144

MIND THE VALUE GAP.
Article 17 of the Directive on Copyright in the Digital Single Market
1 September 2019
Michael Stedman Bernal
ABSTRACT
Over the last few years there has been a turbulent debate about copyright law in the Digital
Single Market. The rules applicable to online platforms in the context of online exploitation of
copyright-protected work required clarification and measures need to be considered to
ensure fair distribution of revenue between online platforms and copyright-holders. To that
end, the EU has adopted a Directive that contains a very controversial provision (Article 17),
which makes online platforms liable for infringing user-generated content in order to force
them to either draw up licenses with right-holders or to ensure the unavailability of copyright-
protected work in their platforms, indirectly encouraging them to use content recognition
technology to monitor all content. This approach is reminiscent of the globalized trend
towards the privatisation of the enforcement of illegal content online and these new rules
clash in different ways with EU law and the CJEU case law. In addition, empirical evidence
supporting Article 17 was never provided and contrary empirical evidence was ignored.
Arguably, Article 17 is a new sui generis exclusive right that works as a lex specialis to the
existing law, with its own conditions and liability mitigation mechanisms. Certainly, Article 17
constitutes an extremely complex legal text that interplays with other provisions of the law
and the existing case law. Therefore, there is a need to clarify the nature, options and pitfalls
of this legal text to ensure uniform national implementations across the EU in order to make
the Digital Single Market work.
Key words: copyright; online content service providers; value gap; intermediary liability;
communication to the public; Digital Single Market.
Electronic copy available at: https://ssrn.com/abstract=3810144

TABLE OF ABBREVIATIONS
CJEU Court of Justice of the European Union
Commission European Commission
Copyright Directive Directive (EU) 2019/790 of the European Parliament and of the
Council of 17 April 2019 on copyright and related rights in the
Digital Single Market and amending Directives 96/9/EC and
2001/29/EC
DSM Digital Single Market
ECD E-Commerce Directive 2000/31/EC
ECFR European Charter of Fundamental Rights
Enforcement Directive Directive 2001/29/EC of the European Parliament and of the

Council of 22 May 2001 on the harmonisation of certain
aspects of copyright and related rights in the information
society Directive 2004/48/EC enforcement of intellectual
property
EU European Union
InfoSoc Directive Directive 2001/29/EC of the European Parliament and of the

Council of 22 May 2001 on the harmonisation of certain
aspects of copyright and related rights in the information
society
OCSSP Online content sharing service provider
Proposal Proposal for a Directive of the European Parliament and of the

Council on copyright in the Digital Single Market -
COM(2016)593

TABLE OF CASES
- Football Association Premier League v QC Leisure, and Karen Murphy v Media Protection
Services, joined cases C-403/08 and C-429/08) [2011]
- Google France v Louis Vuitton, Google France v Viaticum and Luteciel, and Google France
v CNRRH, joined cases C-236/08 to C-238/08 [2010]
- GS Media v Sanoma (C-160/15) [2016]
- L’Oréal v eBay (C-324/09) [2011]
- Land Nordrhein-Westfalen v Dirk Reckhoff (C-161/17) [2018]
- Referral C-500/19 (Puls 4 TV, 2019)
- Referral C-682/18 (YouTube, 6 November 2018)
- Referral C-683/18 (Elsevier, 6 November 2018)
- Reha Training v Gema (C-117/15) [2016]
- Sabam v Netlog (C-360/109) [2012]
- SBS v Sabam (C-325/14) [2015]
- Scarlet v Sabam (C-70/10) [2011]
- SGAE v Rafael Hoteles SA (C-306/05) [2006]
- Stichting Brein v Jack Frederik Wullems (Filmspeler) (C-527/15) [2017]
- Stichting Brein v Ziggo BV (Pirate Bay) (C-610/15) [2017]
- Svensson v Retriever Sverige AB (C-466/12) [2014]
- VCAST Limited v R.T.I SpA (C-265/16) [2016]
TABLE OF STATUES
- Directive (EU) 2019/790 of the European Parliament and of the Council of 17 April 2019
on copyright and related rights in the Digital Single Market and amending Directives
96/9/EC and 2001/29/EC
- Proposal for a Directive of the European Parliament and of the Council on copyright in
the Digital Single Market - COM(2016)593
- Corrigendum to Directive 2004/48/EC of the European Parliament and of the Council of
29 April 2004 on the enforcement of intellectual property rights (OJ L 157, 30-04-2004)
- Directive 2001/29/EC of the European Parliament and of the Council of 22 May 2001 on
the harmonisation of certain aspects of copyright and related rights in the information
society Directive 2004/48/EC enforcement of intellectual property
- Charter of Fundamental Rights of the European Union (C 326/02)
- 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

TABLE OF CONTENTS
INTRODUCTION .................................................................................................................. 5
Chapter 1. The supposed problem and the proposed solution ............................................ 7

1.1. Distribution of copyright-protected work and “value gap” ....................................... 7
1.2. A Strategy for a Digital Single Market ....................................................................... 9
1.3. Proposal for a Directive on Copyright in the Digital Single Market ......................... 11
Chapter 2. The (un)popular Article 17 ............................................................................... 16

2.1. Main amendments .................................................................................................. 16
2.2. Definition of OCSSP (art. 2.6)................................................................................... 16
2.3. New liability for OCSSPs (art. 17.1 – 17.3) ............................................................... 17
2.4. Liability exemption mechanism (art. 17.4 - 17.5) .................................................... 18
2.5. Exceptions and limitations (art. 17.6 - 17.8)............................................................ 21
2.6. Complaint and redress mechanism (art. 17.9) ........................................................ 22
2.7. Stakeholder dialogues (art. 17.10) .......................................................................... 23
Chapter 3. How to implement the new rules .................................................................... 25

3.1. Implementing the Copyright Directive..................................................................... 25
3.2. General issues.......................................................................................................... 26
3.3. Licensing obligation ................................................................................................. 29
3.4. Preventive obligations ............................................................................................. 30
3.5. Over-blocking .......................................................................................................... 32
CONCLUSIONS .................................................................................................................. 34
Bibliography ..................................................................................................................... 36

INTRODUCTION
The evolution of digital technology has influenced the creation, distribution and exploitation
of copyright-protected work. Users often upload copyright-protected work to online
platforms. Copyright-holders argue that the revenue generated from the online use of their
work is unfairly distributed (value gap). And online platforms argue that there are not liable
for the infringing act performed by their users as long as they have no knowledge of it and
they remove it upon notice.
Since the EU Commission recognised that the rules applicable to online platforms in relation
to user-generated content required clarification and that measures to safeguard fair
remuneration of copyright-holders need to be considered, it announced that it would
establish a modern, more European copyright framework to harmonise the law and
incentivise creativity, investment, and the transmission and consumption of content across
borders. To that end, in 2016, the Commission released a Proposal for a Directive on Copyright
in the Digital Single Market which would modify the current intermediary liability regime –
even though it previously noticed the importance of maintaining it.
The Directive aims to clarify the role of online service providers in the distribution of copyright-
protected content and set forth measures to improve the position of right-holders to
negotiate and be remunerated for the exploitation of their work. However, it is incompatible
with the EU acquis and the CJEU case law. Moreover, not only was supporting empirical
evidence never provided, but contrary evidence that might have emphasised positive
externalities for creativity, digitization, and platform economy was never considered. The
most controversial provision, Article 17, makes online platforms liable for infringing user-
generated content in order to either force them into licensing agreements with copyright-
holders –to allegedly close the value gap– or indirectly make them use content recognition
technology to ensure protection of works –to arguably privatise the enforcement of illegal
content online. The EU was strongly discouraged from adopting this provision. Academics
suggested either adjusting the existing law or a re-assessment of the provision. However, the
EU voted in favour of the Directive which came into effect on the 7th of June 2019.
While academics welcome the ambition for copyright rules to be modernised, they claimed
that their diagnosis is still correct: Article 17 is incompatible with the EU acquis and tries to
indirectly amend it, hindering digital innovation and users’ participation.
The debate is not going to go away completely. However, at this point, it has ceased to have
so much relevance since a political decision has been made and the law has been adopted,
which now needs to be implemented to make the digital market work. There is one thing that
probably all sides of the debate agree upon: Article 17 is a highly complicated legal text. It
interacts with other provision of the law and comes with many Recitals which add meaning,
not always in a clear way. This is what needs clarifying. Otherwise, without legal certainty, a
fully functioning Digital Single Market cannot be built and the conflicting national
implementations will not be to the benefit of users, right-holders and the economy at large.

The aim of this paper is to analyse Article 17 in relation to its scope, the exclusive right of
communication to the public, intermediary liability law, licensing obligations, preventive
obligations, and over-blocking. The first chapter will provide a background which focuses on
the strongly criticised narrative behind it. The second chapter analyses the letter of the law.
The third chapter aims to clarify this highly complicated legal text in an effort to offer some
ideas for practical solutions for its implementation.
It will be argued that Article 17 does not clarify its scope and service providers could eventually
be unexpectedly caught, which will hinder innovation and market entry. It will also be argued
that Article 17 is not an extension of the exclusive right to communication to the public, but a
completely new right (also called communication to the public), a sui generis exclusive right
with its own conditions and liability mitigation mechanisms that acts as a lex specialis to the
existing applicable laws. It will be contended that, despite the fact that the licensing approach
in Article 17 empowers copyright-holders in the context of negotiations, it is important to
strike a balance in order to avoid service providers blocking content to prevent liability. It will
also be contended that the preventive obligations indirectly encourage service providers to
use content recognition technology to monitor their websites in order to avoid liability. This
could lead to the removal of lawful content (over-blocking) to the detriment of users’
fundamental rights, creators, and the whole Digital Single Market.

Chapter 1. The supposed problem and the proposed solution
1.1. Distribution of copyright-protected work and “value gap”
The Internet has become the main marketplace for the distribution and exploitation of works,
particularly through online platforms (intermediaries), such as YouTube or Facebook.
Intermediaries enable their users to upload content –often copyright-protected— which is
used to increase the value of their services, attract more users, and profit from advertising
and users’ data. Copyright-holders claim that the revenue generated from the online use of
their work is unfairly distributed. This issue has been termed the “value gap” in the online
exploitation of copyright works.1
Copyright-holders have the exclusive right to authorise or prohibit any communication to the
public of their work (Article 3.1 of the Infosoc Directive).2 However, the act of communication
to the public is generally done by users who upload protected content to online platforms
infringing copyrights.3 There is an huge number of infringing acts in a wide variety of
jurisdictions, the prosecution of which is not feasible for either the petitioned courts nor for
copyright-holders.4 And claiming damages from infringing users is practically unenforceable
in most cases, since they are often not financially viable.5
Online platforms that act in a strictly passive manner and have no knowledge or awareness of
the infringement are not liable for damages caused by their users in accordance with Article
14 of the E-Commerce Directive, ECD (hosting safe harbour).6 The Court of Justice of the
European Union (CJEU) clarified that this liability exemption applies only where the activity of
the online platform “is of a mere technical, automatic and passive nature, which implies that
the information society service provider [the online platform] has neither knowledge of nor
1
Christina Angelopoulos, ‘On Online Platforms and the Commission’s New Proposal for a Directive on
Copyright in the Digital Single Market’ [2017] Center for Intellectual Property and Information Law (CIPIL) 1.
p.2; referring to Proposal for a Directive of the European Parliament and of the Council on copyright in the
Digital Single Market, COM(2016) 593 final; European Commission, ‘Communication from the Commission to
the European Parliament, the Council, the European Economic and Social Committee and the Committee of the
Regions on ‘Promoting a Fair, Efficient and Competitive European Copyright-Based Economy in the Digital
Single M’.; and European Commission, ‘Impact Assessment on the Modernisation of EU Copyright Rules
Accompanying the Document Proposal for a Directive of the EU Parliament and of the Council on Copyright in
the Digital Single Market and Proposal for a Regulation of the EU Parliament’.
2
Directive 2001/29/EC of the European Parliament and of the Council of 22 May 2001 on the harmonisation of
certain aspects of copyright and related rights in the information society Directive 2004/48/EC enforcement of
intellectual property
3
Christina Angelopoulos, ‘EU Copyright Reform: Outside the Safe Harbours , Intermediary Liability Capsizes into
Incoherence’ (Kluwer Copyright Blog, 2016) 1 <http://copyrightblog.kluweriplaw.com/2016/10/06/eu-
copyright-reform-outside-safe-harbours-intermediary-liability-capsizes-incoherence/>. p. 3
4
Ursula Feindor-Schmidt, ‘Art . 17 of the New Copyright Directive : What Must Rightholders and Platforms Do
Now?’ (Copyright and Media Law, 2019) 1 <https://www.lausen.com/en/art-17-of-the-new-copyright-
directive-what-must-rightholders-and-platforms-do-now/>. p. 3
5
Matthias Leistner and Axel Metzger, ‘The EU Copyright Package: A Way Out of the Dilemma in Two Stages’
(2017) 48 International Review of Intellectual Property and Competition Law 381. p.1
6
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

control over the information which is transmitted or stored".7 Once online platforms have
obtained knowledge of the unlawful nature of the content, they must act expeditiously to
remove or disable access to the information in accordance with Article 14.1.b of the ECD
(“notice-and-takedown”). In order to hold online platforms directly liable, their involvement
in the infringement must be such that it essentially becomes its own.8
Since there is no legal requirement obliging online platforms to engage with copyright-holders
in licensing agreements, copyright-holders claim that online platforms refuse to negotiate or
offer artificially low rates, so they are faced with a “take it or leave it” approach. In addition,
if an agreement is not reached, copyright-holders have no choice but to continue to send
notifications for each individual infringement committed by users in order to place online
platforms under the obligation to remove the infringing content (Article 14.1.b ECD). As a
result, copyright-holders encounter difficulties to license their rights and to obtain fair
remuneration for the online use of their work.9
Online platforms emphasise that they have no legal obligation to negotiate with copyright-
holders and that they only enter into monetisation agreements with them on a purely
voluntary basis. They claim that they often implement voluntary measures to help copyright-
holders to identify and monetise the use of their works, including through content recognition
technology.10 For instance, Google’s policy regarding the YouTube’s Content ID (launched in
2008) is to monetize the content for the copyright owner by running advertisements against
it, before removing or blocking it.11
However, the use of technology to identify infringements often leads to “false positives”, the
erroneous identification and take-down of content that is not unlawful.12 At the present level
of sophistication of this technology, the accurate identification of infringements remains
challenging and the blocking of lawful communications violates users’ fundamental right to
freedom of expression.13
The value gap also affects subscription-financed online platforms, such as Netflix or Spotify.
These platforms do not host user-generated content. They retain control over their offerings
7
L’Oréal v eBay International (C-324/09) [2011]; Google France v Louis Vuitton, Google France v Viaticum and
Luteciel, and Google France v CNRRH, joined cases C-236/08 to C-238/08 [2010]
8
Angelopoulos, ‘EU Copyright Reform: Outside the Safe Harbours , Intermediary Liability Capsizes into
Incoherence’ (n 3). p. 3
9
Angelopoulos, ‘On Online Platforms and the Commission’s New Proposal for a Directive on Copyright in the
Digital Single Market’ (n 1). pp. 1-2 referring to a number of music reports.
10
European Commission, ‘Impact Assessment on the Modernisation of EU Copyright Rules Accompanying the
Document Proposal for a Directive of the EU Parliament and of the Council on Copyright in the Digital Single
Market and Proposal for a Regulation of the EU Parliament’ (n 1).
11
Giancarlo Frosio, ‘To Filter or Not to Filter: That Is the Question in EU Copyright Reform’
<https://ssrn.com/abstract=3058680>. p. 137
12
European Commission, ‘Impact Assessment on the Modernisation of EU Copyright Rules Accompanying the
Document Proposal for a Directive of the EU Parliament and of the Council on Copyright in the Digital Single
Market and Proposal for a Regulation of the EU Parliament’ (n 1).
13
Digital Single Market’ (n 1). p. 5; European Commission, ‘Impact Assessment on the Modernisation of EU
Copyright Rules Accompanying the Document Proposal for a Directive of the EU Parliament and of the Council
on Copyright in the Digital Single Market and Proposal for a Regulation of the EU Parliament’ (n 1).

and require authorisation from copyright-holders to operate legally. Therefore, they face
content-acquisition costs which put them at a competitive disadvantage to ad-financed online
platforms, which use user-generated content.14
1.2. A Strategy for a Digital Single Market
On the 6th of May 2015, the EU Commission announced its Strategy for a Digital Single Market
(DSM) to foster a cross-border European digital economy.15 Among other things, the strategy
focuses on the establishment of a modern, more European copyright framework.16
The Commission recognised the need of a more harmonised copyright regime to incentivise
creativity, investment, and the transmission and consumption of content across borders.17 It
noted that the rules applicable to intermediaries in relation to user-generated content require
clarification and that measures to safeguard fair remuneration of copyright-holders need to
be considered.18 In particular, given the growing involvement of online platforms in content
distribution, the Commission contemplated the introduction of an enhanced obligation (a
duty of care) for online platforms dealing with unlawful content uploaded by their users, such
as child pornography, terrorist material, and content that infringes intellectual property
rights.19
The Commission acknowledged the relevance of the hosting safe harbour (Article 14 of the
ECD) for “the development of the Internet in Europe”, since online platforms need to rely on
a legal framework that allows them to ensure the continued free flow of information in the
network.20 However, it also identified some of its weak points, such as the unclear boundaries
of liability for intermediaries and the inconsistent approach in national case law (due to some
14
Digital Single Market’ (n 1). p. 5; Angelopoulos, ‘EU Copyright Reform: Outside the Safe Harbours , Intermediary
Liability Capsizes into Incoherence’ (n 3). p. 1
15
European Commission, ‘Communication from the Commission to the European Parliament, the Council, the
European Economic and Social Committee and the Committee of the Regions “A Digital Single Market Strategy
for Europe”’ (2015).
16
Digital Single Market’ (n 1). pp. 5-6; European Commission, ‘Communication from the Commission to the
European Parliament, the Council, the European Economic and Social Committee and the Committee of the
Regions “A Digital Single Market Strategy for Europe”’ (n 15).
17
18
for Europe”’ (n 15). 2.4
19
Giancarlo Frosio, ‘From Horizontal to Vertical: An Intermediary Liability Earthquake in Europe.’ (2017) 565
Oxford Journal of Intellectual Property Law and Practice 1. p.2, referring to European Commission,
‘Communication from the Commission to the European Parliament, the Council, the European Economic and
Social Committee and the Committee of the Regions “A Digital Single Market Strategy for Europe”’ (n 15). 3.3.2
20
European Commission, ‘First Report on the Application of 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’. para.65

Member States deviating from the wording of Article 14 of the ECD in its transposition).21
Finally, it also raised concerns about the slow and complicated notice-and-takedown
procedure for removing infringing content.22
On the 9th of December 2015, the Commission published its communication “Towards a
Modern, More European Copyright Framework”.23 The Commission claimed that the legal
framework undermines the fair sharing of value generated by the online distribution of works.
In particular, it identified the uncertain scope of the right of communication to the public and
the hosting safe harbour (Article 14 of the ECD).24
Meanwhile, the Commission launched two public consultations. One of them considered
revisiting some of the provisions established by the Enforcement of Intellectual Property
Rights Directive 2004/48/EC (Enforcement Directive), a reform that would affect intermediary
liability law.25 The other consultation aimed to assess the role of intermediaries and whether
the hosting safe harbour regime is still fit for the purpose.26 In 2016, the Commission published
a report on the responses received, the majority of which indicate that the hosting safe
harbour regime is still appropriate.27 Nonetheless, according to certain copyright-holders, the
uncertainties surrounding their exclusive right to communication to the public and the unclear
scope of the hosting safe harbour negatively affect licensing and create an imbalance in the
online marketplace in favour of online platforms.28
21
for Europe”’ (n 15).
22
23
European Economic and Social Committee and the Committee of the Regions, “Towards a Modern, More
European Copyright Framework”’ (2015).
24
Digital Single Market’ (n 1). p. 6 referring to European Commission, ‘Communication from the Commission to
Regions, “Towards a Modern, More European Copyright Framework”’ (n 23).
25
Frosio, ‘From Horizontal to Vertical: An Intermediary Liability Earthquake in Europe.’ (n 19). p. 3; European
Commission, ‘Public Consultation on the Evaluation and Modernisation of the Legal Framework for the
Enforcement of Intellectual Property Rights’ (2015).; Corrigendum to Directive 2004/48/EC of the European
Parliament and of the Council of 29 April 2004 on the enforcement of intellectual property rights (OJ L 157,
30.4.2004)
26
Frosio, ‘From Horizontal to Vertical: An Intermediary Liability Earthquake in Europe.’ (n 19). p. 4; Eleonora
Rosati, ‘Why a Reform of Hosting Providers’ Safe Harbour Is Unnecessary Under EU Copyright Law’ (2016) 38
E.I.P.R. 668. p. 669; European Commission, ‘Public Consultation on the Regulatory Environment for Platforms,
Online Intermediaries, Data and Cloud Computing and the Collaborative Economy’ (2015)
<https://ec.europa.eu/digital-single-market/en/news/public-consultation-regulatory-environment-platforms-
online-intermediaries-data-and-cloud>.
27
European Commission, ‘Synopsis Report on the Public Consultation on the Regulatory Environment for
Platforms, Online Intermediaries and the Collaborative Economy’
<http://ec.europa.eu/newsroom/dae/document.cfm?doc_id=15877>.
28
Rosati, ‘Why a Reform of Hosting Providers’ Safe Harbour Is Unnecessary Under EU Copyright Law’ (n 26). p.
669; Directive 2001/29/EC of the European Parliament and of the Council of 22 May 2001 on the
10

In view of the results, the Commission released in 2016 their first action plan titled “Online
Platforms and the Digital Single Market”.29 It announced that it will: (1) maintain the
intermediary liability regime; (2) address the problem of the fair allocation of value between
online platforms and copyright holder through “sector-specific” regulation; (3) release
guidance on the liability of online platforms that undertake voluntary, good-faith measures to
address online illegality; and (4) consider the introduction of a formal EU notice-and-action
procedure.30
In June 2016, the Commission released its “Communication on a European Agenda for the
Collaborative Economy”.31 It remarked again on the importance of maintaining the existing
intermediary liability regime for the development of the digital economy in the EU.
Yet, in 2016, the Commission published its Proposal for a Directive on Copyright in the Digital
Single Market (the Proposal), which includes in Article 13 (Article 17 in the final text) a new
liability regime for online platforms to bridge the value gap.32
1.3. Proposal for a Directive on Copyright in the Digital Single Market
On the 14th of September 2016, the Commission released the Proposal, which is part of a
larger package to modernise EU copyright rules to achieve a fully functioning DSM.33. The
Proposal attempted, among other things, to clarify the role of online service providers in the
distribution of copyright-protected content and set forth measures to improve the position of
right-holders to negotiate and be remunerated for the exploitation of their work, claiming that
a lack of participation of right-holders in the profits could put at risk creativity and innovation.
However, this Proposal undermined important provisions in the EU acquis. Its Article 13
(Article 17 in the final text) on “Certain uses of protected content by online services” and
Recitals 38 and 39 are especially controversial in a number of different ways. They contained
ambiguous language, undefined legal concepts, and relied on a questionable interpretation of
harmonisation of certain aspects of copyright and related rights in the information society; IFPI, ‘Global Music
Report’ (2016) <http://www.ifpi.org/news/IFPI-GLOBAL-MUSIC-REPORT-2016>.
29
European Economic and Social Committee and the Committee of the Regions on “Online Platforms and the
Digital Single Market – Opportunities and Challenges for Europe”’ (2016).
30
Digital Single Market’ (n 1). p. 6 referring to European Commission, ‘Communication from the Commission to
Regions on “Online Platforms and the Digital Single Market – Opportunities and Challenges for Europe”’ (n 29).
31
European Economic and Social Committee and the Committee of the Regions on “A European Agenda for the
Collaborative Economy”’.
32
Proposal for a Directive of the European Parliament and of the Council on copyright in the Digital Single
Market, COM(2016) 593 final
33
Frosio, ‘From Horizontal to Vertical: An Intermediary Liability Earthquake in Europe.’ (n 19). p. 5; Proposal for
a Directive of the European Parliament and of the Council on copyright in the Digital Single Market, COM(2016)
593 final
11

the law, which reveals a lack of understanding of EU copyright and intermediary liability law
and an alarming disregard for fundamental rights.34
The criticism began. On the 30th of September 2016, forty academics sent an open letter to
the Commission on the importance of preserving the consistency and integrity of the EU
acquis.35 While they acknowledged the importance of reviewing the law, they also claim that
the Proposal puts its consistency and integrity at risk. After briefly analysing Article 13 and
Recitals 38 and 39 of the Proposal, academics concluded that it is incompatible with EU law,
the CJEU case law, and the European Charter of Fundamental Rights (ECFR) for three reasons:
it imposes a general obligation to monitor to certain intermediaries; it ignores transparency
obligations towards users; and it implies that in in some cases certain intermediaries will
require a licence for their “use” of protected works.36 Moreover, it was pointed out that
independent empirical evidence was ignored and consultations were interpreted and
summarised in a misleading manner.37 Not only was empirical evidence supporting the
Proposal never provided, but contrary evidence that might have emphasised positive
externalities for creativity of the internet, digitization, and platform economy was never
considered.38
In a nutshell, the Article 13 and Recitals 38 and 39 provided that online platforms that give
public access to large amounts of content uploaded by their users perform an act of
communication to the public –disregarding the safe harbour protection—, so they should
either conclude licensing agreements with right-holders or take appropriate and
proportionate measures to ensure protection of works, such as implementing content
recognition technologies. Therefore, failing to clarify when and on what legal grounds online
platforms may be liable, the Proposal forces them into licensing agreements to close the value
gap and imposes an obligation to monitor users’ content to prevent copyright infringement.39
Let us expand the following:
Firstly, Article 13 targeted “information society services storing and giving access to large
amounts of copyright-protected content uploaded by their users”. This definition was not in
34
Incoherence’ (n 3). pp. 1 and 7; Max Planck Institute for Innovation and Competition, ‘Position Statement on
the Proposed Modernization of European Copyright Rules: Part G, Use of Protected Content on Online
Platforms’ (2016)
<https://www.ip.mpg.de/fileadmin/ipmpg/content/stellungnahmen/MPI_Position_Statement_PART_G_incl_A
nnex-2017_03_01.pdf>.; p. 3; and Ted Shapiro, ‘EU Copyright Will Never Be the Same: A Comment on the
Proposed Directive on Copyright for the Digital Single Market (DSM)’ (2016) 38(12) E.I.P.R. 771. p. 773
35
Sophie Stalla-Bourdillon and others, ‘Open Letter to the European Commission – On the Importance of
Preserving the Consistency and Integrity of the EU Acquis Relating to Content Monitoring within the
Information Society’ (2016) <https://papers.ssrn.com/abstract=2850483%3E>.
36
Sophie Stalla-Bourdillon and others, ‘A Brief Exegesis of the Proposed Copyright Directive’ [2017] SSRN
Electronic Journal <https://www.ssrn.com/abstract=2875296>. pp. 10-11
37
Research Centres, ‘EU Copyright Reform Proposals Unfit for the Digital Age’ (2017). p. 1; Giuseppe Colangelo
and Mariateresa Maggiolino, ‘ISPs’ Copyright Liability in the EU Digital Single Market Strategy’ (2018) 26
International Journal of Law and Information Technology 142. pp. 12-15
38
Giancarlo Frosio, ‘Reforming Intermediary Liability in the Platform Economy: A European Digital Single
Market Strategy’ (2019) 112 SSRN Electronic Journal 19 <https://ssrn.com/abstract=2912272>.; and Frosio, ‘To
Filter or Not to Filter: That Is the Question in EU Copyright Reform’ (n 11). p. 133
39
Research Centres (n 37). p. 6
12

itself enough to clarify the scope of application and it arguably included service providers like
Wikipedia or Medium.40
Secondly, Article 13 imposed an obligation to the targeted service providers to either “ensure
the functioning of agreements concluded with rightholders” or put in place measures to
“prevent the availability on their services of works or other subject-matter identified by
rightholders”, such as the use of “effective content recognition technologies”.41 Recital 39
confirmed the importance of using content recognition technologies. Given the vast quantity
of works that service providers host, the only practical way to prevent copyright infringement
is by implementing “content recognition technology” to filter and monitor user’s content.42
This is contrary to Article 15 of the ECD, which sets forth a prohibition to impose a general
monitoring obligation. In addition, the CJEU stated in L’Oréal v eBay that a general monitoring
obligation would be incompatible with Article 3 of the Enforcement Directive, and rejected in
Sabam v Netlog the use of filtering measures on the basis that they would fail to strike a “fair
balance” between the following fundamental rights: (1) right to property, including
intellectual property (article 17.2 of the ECFR) and (2) the platform’s freedom to conduct
business (article 16 of the ECFR); protection of personal data (article 8 of the ECFR); and the
users’ right to freedom of expression (article 11 of the ECFR).43 Moreover, there is a risk that
content recognition technologies suppress lawful uses of content (“over-blocking”), since they
are unable to detect merely cited, parodied or reviewed content and other uses of work that
benefit from the protection of an exception or limitation to copyright.44 Taking into account
this risk of censorship, it should be the task of authorised judges to decide on the legality of
content (Scarlet v Sabam and Sabam v Netlog).45
Thirdly, Recital 38 muddied the waters further.46 According to the CJEU, in Google France v
Louis Vuitton, service providers should be considered for the hosting safe harbour protection
unless they are not passive.47 However, Paragraph 1 assumed that services providers are
generally not passive and therefore are prima facie not hosting providers for the purpose of
the safe harbour protection. It stated that service providers play an active role “by optimising
40
Stalla-Bourdillon and others (n 36). p. 4; 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
41
Stalla-Bourdillon and others (n 35).; Max Planck Institute for Innovation and Competition (n 34). p. 8;
Proposal for a Directive of the European Parliament and of the Council on copyright in the Digital Single
Market, COM(2016) 593 final
42
Christina Angelopoulos, ‘Kluwer Copyright Blog Axel Voss ’ s JURI Report on Article 13 Would Violate Internet
Users ’ Fundamental Rights’ (2018) 1 <http://copyrightblog.kluweriplaw.com/2018/06/29/axel-vosss-juri-
report-article-13-violate-internet-users-fundamental-rights/>.
43
L’Oréal v eBay (C-324/09) [2011]; Corrigendum to Directive 2004/48/EC of the European Parliament and of
the Council of 29 April 2004 on the enforcement of intellectual property rights (OJ L 157, 30-04-2004); and
Incoherence’ (n 3). pp. 5-6 referring to Sabam v Netlog (C-360/109) [2012]
44
Stalla-Bourdillon and others (n 36). p.8
45
Max Planck Institute for Innovation and Competition (n 34). p. 9; Stalla-Bourdillon and others (n 36). p. 8;
Scarlet v Sabam (C-70/10) [2011] and Sabam v Netlog (C-360/109) [2012]
46
Stalla-Bourdillon and others (n 36). p. 11
47
Google France v Louis Vuitton, Google France v Viaticum and Luteciel, and Google France v CNRRH, joined
cases C-236/08 to C-238/08 [2010]
13

the presentation of the uploaded works or subject-matter or promoting them”. This loosens
the test set in L’Oréal v eBay and undermines the text of the ECD by limiting the application
of the hosting safe harbour.48 Recital 38 also assumed that service providers are prima facie
responsible for the communication to the public of copyright-protected work and therefore
copyright infringers. It has to be taken into account that the concept of “Communication to
the public” has become increasingly complex since it has been subject to numerous referrals
to the CJEU.49 Traditionally, the CJEU emphasized the indispensable role of the user (Football
Association Premier League v QC Leisure, and Murphy v Media Protection Services, joined
cases).50 After the Proposal, the CJEU has developed its jurisprudence in GS Media, Filmspeler
and the Pirate Bay and accepted the idea that service providers that knowingly play an
essential role in making available copyright-protected work uploaded by users may fall within
the scope of Article 3.1 of the InfoSoc Directive.51 The CJEU outperformed the Commission at
defining the scope of “communication to the public” in this area.52 Therefore, it is doubtful
that the mere act of storing and allowing public access to copyright-protected work uploaded
by users is consistent with the CJEU interpretation, for knowledge of the infringement is
required if it is to amount an act of communication to the public.53 Overall, Recital 38 is not
clear in its scope and effects, instead, created confusion. In addition, it is contrary to EU law
(Articles 14 and 15 of the ECD and article 3.1 of the InfoSoc Directive) and the relevant CJEU
jurisprudence.54
The idea of harmonising substantive intermediary liability law is not bad, since it may stabilise
the current fragmented EU system and provide legal certainty for copyright-holders,
intermediaries and users. However, the Proposal was “ill-conceived, badly-worded and
incompatible with established law”.55 Moreover, it did not provide a solution for the value gap
and would not have achieved its objectives.56
The EU was strongly discouraged from adopting Article 13. Academics requested a public and
transparent discussion on the interplay between the proposed Directive and the ECD and
48
Stalla-Bourdillon and others (n 36). p. 12; Martin Husovec, ‘EC Proposes Stay-down & Expanded Obligation to
License UGC Services’ (Hut’ko’s Technology Law Blog, 2016) <https://perma.cc/CYG5-
LZF9%0Ahttp://www.husovec.eu/2016/09/ec-proposes-stay-down-expanded.html>.; L’Oréal v eBay (C-324/09)
[2011]
49
Eleonora Rosati, ‘The Right of Communication to the Public ... in a Chart’ (The IPKat, 2017) 1
<https://ipkitten.blogspot.com/2017/07/the-right-of-communication-to-public-in.html>. p. 1
50
Frosio, ‘To Filter or Not to Filter: That Is the Question in EU Copyright Reform’ (n 11). p. 115 referring to
Football Association Premier League v QC Leisure, and Karen Murphy v Media Protection Services, joined cases
C-403/08 and C-429/08) [2011]
51
Colangelo and Maggiolino (n 37). p. 8 and Eleonora Rosati, ‘The CJEU Pirate Bay Judgment and Its Impact on
the Liability of Online Platforms’ (2017) 39 E.I.P.R. 737. p. 12; both referring to GS Media v Sanoma (C-160/15)
[2016], Stichting Brein v Jack Frederik Wullems (2017) (Filmspeler case), and Stichting Brein v Ziggo VB (C-
610/15) [2017] (the Pirate Bay case)
52
Matthias Leistner, ‘Is the CJEU Outperforming the Commission?’ [2017] SSRN Electronic Journal 1
53
Colangelo and Maggiolino (n 37). p. 9
54
Stalla-Bourdillon and others (n 36). p. 15
55
Incoherence’ (n 3). p. 7
56
Max Planck Institute for Innovation and Competition (n 34). p. 18; Leistner and Metzger (n 5). p. 382; Frosio,
‘To Filter or Not to Filter: That Is the Question in EU Copyright Reform’ (n 11). p. 109
14

InfoSoc Directive. They suggested either adjusting the ECD and InfoSoc Directive instead of
adopting Article 13 or a re-assessment of Article 13 and Recital 39 and the removal or
substantial re-draft of Recital 38.57
As was predicted, the Proposal did not survive the legislative process in its original form.58
After amendments, however, both the European parliament (26 March 2019) and the
European Council (15 April 2019) voted in favour of the Directive 2019/790 on Copyright in
the Digital Single Market (the Copyright Directive), which includes in its Article 17 an amended
version of Article 13 of the Proposal.59 The Directive came into effect on the 7th of June 2019.
From this date, EU Member States have 2 years to adapt their copyright laws to reflect the
Copyright Directive.
By 2019, more than 200 academics from over 25 research centres have published and signed
open letters opposing this Proposal. While academics welcomed the ambition for copyright
rules to be modernised in light of the digital revolution, new consumer behaviour, and cultural
diversity, the implementation of this objective was misguided. Policy making shifted from
“legislative steps towards a connected DSM” into supporting narrow sectoral interest.
Parliamentary debate became an ideological battle between European culture and the so-
called “GAFA” (Google, Apple, Facebook, Amazon), the multinational industrial complex
dominated by US firms. Academics claimed in 2017 that this Proposal indirectly tries to amend
the ECD, hindering digital innovation and users’ participation. In March 2019, they claimed
this diagnosis is still correct. “It does not happen often that there is wide scientific consensus
on a contested policy issue. This is such a case, and policy makers need to take note.”60
57
Stalla-Bourdillon and others (n 35). And Stalla-Bourdillon and others (n 36). p. 1; Research Centres (n 37). p.
7; and Josef Drexl and others, ‘Max Planck Institute for Innovation and Competition’ (2017)
<https://www.ip.mpg.de/fileadmin/ipmpg/content/stellungnahmen/Answers_Article_13_2017_Hilty_Moscon-
rev-18_9.pdf>. p. 1
58
Shapiro (n 34). p. 778
59
European Commission, ‘Copyright Reform: The Commission Welcomes European Parliament’s Vote in Favour
of Modernised Rules Fit for Digital Age’ (2019) <http://europa.eu/rapid/press-release_STATEMENT-19-
1839_en.htm>.; Directive (EU) 2019/790 of the European Parliament and of the Council of 17 April 2019 on
copyright and related rights in the Digital Single Market and amending Directives 96/9/EC and 2001/29/EC
60
European Academics, ‘The Copyright Directive : Articles 11 and 13 Must Go. Statement from European
Academics in Advance of the Plenary Vote on 26 March 2019’ (2019) <http://bit.ly/2loFISF>.
15

Chapter 2. The (un)popular Article 17
2.1. Main amendments
The Copyright Directive provides a definition of the targeted online platforms in Article 2.6, a
new liability regime for them in Article 17, and clarification in Recitals 61 to 71.
The amended provision presents three main relevant changes while licensing remains the
main obligation. (1) It redefines the target to “online content sharing services providers”
(OCSSPs) (2) It clearly states that OCSSPs perform an act of communication to the public,
disregarding the liability exemption in Article 14 of the ECD. This is why OCSSPs should seek
licenses to prevent liability for infringing user-generated content. Alternatively, OCSSPs have
to prove they have: made “best efforts” to obtain a license; made “best efforts” to ensure the
unavailability of specific works for which right-holders have provided the relevant
information; and, acted expeditiously upon notice to take down infringing content and made
“best efforts” to prevent future uploads. (3) It does not contain any explicit reference to
content recognition technologies. However, in order to practically comply with its obligations,
OCSSPs will have to rely on filtering systems.61
Amendments are commendable. They show an effort in striking a balance between copyright-
holders and Internet users. However, they do not eliminate the main criticism, that Article 17
is incompatible with the InfoSoc Directive, the ECD, and the CJEU jurisprudence.62 This new
provision still raises a number of issues, which will be analysed in the following sections.
2.2. Definition of OCSSP (art. 2.6)
The Copyright Directive targets “online content-sharing service providers” (OCSSP). Article 2.6
provides a definition of OCSSP aiming to clarify what online platforms fall under Article 17.
The structure of the legal framework is based on imposing liability to service providers that
fall within this definition. Any service provider that does not fall within the definition is subject
to the liability regime under the InfoSoc Directive and the ECD.63
Article 2.6, paragraph 1, defines OCSSP as:
“a provider of an information society service of which the main or one of the main
purposes is to store and give the public access to a large amount of copyright-
protected works or other protected subject-matter uploaded by its users, which it
organises and promotes for profit-making purposes”.
61
Maria Lillà Montagnani and Maria Lillà Montagnani, ‘A New Liability Regime for Illegal Content in the Digital
Singel Market Strategy’ [2019] Bocconi Legal Studies Research Paper Series. pp. 10-11
62
Aleksandra Kuczerawy, ‘EU Proposal for a Directive on Copyright in the Digital Single Market: Compatibility of
Article 13 with the EU Intermediary Liability Regime’ (2019) Centre for Center for IT & IP Law (CITIP) 1.
63
Ted Shapiro and Sunniva Hannson, ‘The DSM Copyright Directive - EU Copyright Will Indeed Never Be the
Same’ (2019) 41(7) E.I.P.R. 404. p. 11
16

Article 2.6, paragraph 2, states that the following service providers are not OCSSPs within the
meaning of the Directive: not-for-profit online encyclopaedias (e.g. Wikipedia), not-for-profit
educational and scientific repositories (e.g. university repositories), open source software-
developing and sharing platforms (e.g. GitHub), electronic communication service providers
(e.g. WhatsApp, Twitter), online marketplaces (e.g. eBay) and business-to-business cloud
services (e.g. Microsoft Cloud) and cloud services that allow users to upload content for their
own use (e.g. Dropbox). There might be other services which are not explicitly stated but fall
outside of the definition.64
Recital 62 provides some guidance. It clarifies that the definition in Article 2.6 should target
only online services that “play an important role in the online content market” by competing
for the same audience with other online services such as online audio (e.g. Spotify) or video
streaming services (e.g. Netflix). Recital 62 also provides more details on which services should
be excluded from the definition: internet access providers, business-to-business cloud
services, cloud services such as cyberlockers, online marketplaces the main activity of which
is online retail, open-source software development and sharing platforms, not-for-profit
scientific or educational repositories, and not-for-profit encyclopaedias. Finally, Recital 62
states that the liability exception mechanism in Article 17 should not apply to service providers
which engage or facilitate copyright piracy.
The Copyright Directive excludes from the scope of the definition a number of service
providers which do not store and give access to content for profit making purposes. However,
it does not clarify what “a large amount of copyright-protected work” is, nor which online
services “play an important role in the online content market”.65 Consequently, there is still
some ambiguity, and it remains unclear for some service providers whether they would
unexpectedly be caught under the scope of the definition.
2.3. New liability for OCSSPs (art. 17.1 – 17.3)
Article 17.1 introduces primary liability for OCSSPs. In paragraph 1, it provides that an OCSSP
performs an act of communication to the public “when it gives the public access to copyright-
protected works or other protected subject matter uploaded by its users”. That is, OCSSPs are
responsible for the copyright infringing act made by their users in their websites.66 In
paragraph 2, Article 17.1 provides that OCSSPs shall therefore obtain authorisation from right-
holders (e.g. authors, producers, performers and broadcasters), for instance by concluding
licensing agreements, in order to communicate to the public their work.
Licensing obligations are inherent in the nature of exclusive rights, such as the right to
authorise or prohibit any communication to the public of works.67 This provision imposes on
64
Martin Husovec, ‘How Europe Wants to Redefine Global Online Copyright Enforcement’ [2019] SSRN
Electronic Journal 1 <https://ssrn.com/abstract=3372230>. p. 21
65
Dirk Visser, ‘Trying to Understand the Article Formerly Known as “ 13 ” (“ AFKA 13 ”)’ (2019) 1 1
<https://www.ie-forum.nl/documents/ecli/5c9cd803-3220-4933-9b9e-17bbc35ff8c2.pdf>. p. 3
66
Feindor-Schmidt (n 4). p. 6
67
Shapiro and Hannson (n 63). p. 10
17

OCSSPs an obligation to obtain a license from copyright-holders before their users make
protected subject matter available to the public. If they fail to do so, right-holders may sue
them for infringement.68 However, since right-holders may be unwilling or unavailable to
license, Article 17 provides a liability exemption mechanism for OCSSPs if they demonstrate
they have complied with certain conditions, which will be analysed in the following section.
Recital 64 clarifies that Article 17 does not affect the concept of communication to the public
elsewhere under Union law, nor does it affect the possible application of Article 3 of the
InfoSoc Directive to other service providers. However, it might influence the courts’
interpretation and application of the law.69
Article 17.2 explains that the authorisation obtained by the OCSSP also covers acts carried out
by users that fall within the scope of article 3 of the InfoSoc Directive when they are not acting
on a commercial basis or their activity does not generate significant revenues. That is, any
license obtained by an OCSSP will also cover their users as long as they do not act commercially
or generate significant revenues. Otherwise, another license to cover commercial or highly
profitable uses is required, so both the OCSSP and the user need to get authorisation from the
right-holder and pay for the same communication to the public.70
Article 17.3, paragraph 1, states that the limitation of liability in Article 14 of the ECD (hosting
safe harbour) shall not apply when OCSSPs perform an act of communication to the public.
This is a logical addition. If Article 17.1 makes OCSSPs strictly liable for copyright infringement,
they should not be able to rely on the hosting safe harbour to avoid liability. Otherwise, Article
17 would be meaningless.71 Article 17.3, paragraph 2, clarifies that this does not affect the
possible application of the limitation of liability (Article 14 of the ECD) to OCSSPs for purposes
falling outside the scope of the Copyright Directive. Therefore, there remains the possibility,
if the OCSSP meets the conditions, to invoke the limitation of liability (the hosting safe
harbour) for other forms of infringing content, including other forms of intellectual property
such as trade marks.72
2.4. Liability exemption mechanism (art. 17.4 - 17.5)
OCSSPs are involved in mass deliveries of a large number of different types of work via
personally unknown suppliers (i.e. their users).73 In order to obtain appropriate licenses, they
need to identify which works need to be licensed for public availability. Then, OCSSPs will
have to identify who owns the copyright, which is not always clear because, for instance, there
is an ongoing dispute on copyright ownership. In addition, some right-holder may be unwilling
or unavailable to licence.
68
John Enser, ‘Copyright in the EU Digital Market.’ (2019) 8(3) Comp. & Risk 10. p. 10
69
Visser (n 65). p. 4
70
Feindor-Schmidt (n 4). p. 6; and Visser (n 65). p. 5
71
Visser (n 65). p. 5
72
73
18

Article 17.4 addresses the situation where an OCSSP has not been able to obtain authorisation
from the right-holder, providing certain conditions that OCSSPs need to comply with to avoid
liability.
Recital 66 points out the fact that OCSSPs give access to content which is not uploaded by
them but by their users, so it is appropriate to provide for a specific liability mechanism for
cases in which no authorisation has been granted.
Article 17.4 states that if no authorisation is granted, OCSSPs shall be liable for unauthorised
acts of communication to the public of copyright-protected works, unless they demonstrate
that they have: (a) made best efforts to obtain an authorisation; and (b) made, in accordance
with high industry standards of professional diligence, best efforts to ensure the unavailability
of specific works for which the right-holders have provided the OCSSP with the relevant and
necessary information; and in any event (c) act expeditiously upon notice from the right-
holder to disable access to, or to remove from their websites, the notified works and made
best efforts to prevent their future upload in accordance with point (b).
The first condition (a) requires that OCSSPs have made “best efforts” to obtain an
authorisation. OCSSPs will have to seek a license from any right-holder who is willing to give
it to them.74 Recital 61 remind us that right-holder are not obliged to grant a license: “as
contractual freedom should not be affected (…), right-holders should not be obliged to give
an authorisation or to conclude licensing agreements”.
The second condition (b) requires that OCSSPs have made “best efforts” to ensure the
unavailability of content for which right-holders have provided the relevant and necessary
information. This condition does not prescribe the use of content recognition technology to
ensure the unavailability of unauthorised content. However, given the quantity of content
that OCSSPs host, the only practical way to prevent the risk of becoming liable for infringing
user-generated content is by monitoring their networks. Therefore, this condition arguably
encourages OCSSPs to use filtering measures to ensure the unavailability of unauthorised
content.
As it has been pointed out in section 1.3, any general monitoring obligation is contrary to
Article 15 of the ECD and incompatible with Article 3 of the Enforcement Directive. In addition,
the use of any filtering measures has been rejected by the CJEU for failing to strike a fair
balance between Fundamental Rights. For instance, there is a risk that certain legal uses of
copyright-protected content are accidentally caught and erroneously blocked by the filtering
system (over-blocking). No current filtering system is sophisticated enough to draw a line
between, for instance, a parody and an infringing use.75 This could amount to censorship and
vulnerate users’ freedom of expression (article 11 of the EU Charter).
The third condition (c) requires that OCSSPs maintain an effective “notice-and-take-down”
and “stay-down” mechanism based on the information provided by right-holders in order to
avoid liability. OCSSPs will have to act expeditiously to take down the notified, unauthorised
74
Visser (n 65). p. 6; Shapiro and Hannson (n 63). p. 14
75
19

use of copyright-protected work. The notice-and-takedown procedure is equivalent to the one
prescribed in Article 14 of the ECD. Then, OCSSPs will have to make “best efforts” to prevent
the future upload of the notified works (notice-and-stay-down). This would require OCSSPs to
filter all content of all users in order to block any potential use of the notified work.
Article 17.5 adds a further test for assessing compliance with in Article 17.4, clarifying the
extent of the obligations.76 Article 17.5 states that in determining whether the OCSSP has
complied with the conditions in Article 17.4, and in light of the principle of proportionality,
the following elements, among others, will be taken into account: (a) the type, the audience
and the size of the service and the type of work uploaded by the user; and (b) the availability
of suitable and effective means and their cost for service providers.
Recital 63 clarifies that the assessment should be made on a case-by-case basis, taking into
account a combination of factors, such as the audience of the service and the number of files
of copyright-protected content uploaded by the users.
Therefore, all “best efforts” required from OCSSPs in Article 17.4 have to be interpreted in
light of the principle of proportionality, and the extent of the obligation may differ with the
conditions in Article 17.5: (a) the type of audience, size of the service and type of the work
uploaded, and (b) the availability of suitable and effective means and their cost for the service
provider.77
Recital 66 confirms that when assessing if a OCSSP has made its “best efforts”, account should
be taken of whether the OCSSP has taken all the steps that would be taken by a diligent
operator to prevent the availability of unauthorised works on its website, taking into account
best industry practices, the effectiveness of the steps, and the principle of proportionality.
Only if the OCSSP has demonstrably complied with the conditions in Article 17.4, taking into
account the principle of proportionality and the non-exhaustive elements in Article 17.5, can
it avoid liability for infringements originating from user-generated content.78
Given the vagueness of this mechanism, it remains uncertain how Articles 17.4 and 17.5 will
work in practice. For instance, it is unclear what will satisfy the “best efforts” requirement.
“Best efforts” is a concept largely unknown in EU case law and there will a lot of discussion as
to what it means, ultimately before the CJEU.79
In addition, the Copyright Directive has been translated into all official EU languages, but the
various language versions are not entirely consistent with the version of the directive that was
negotiated and eventually adopted.80 With regards to the requirement of “best efforts”, some
language versions entail something else, for instance, the Spanish version requires “los
76
Shapiro and Hannson (n 63).
77
Visser (n 65). p. 7
78
79
Enser (n 68). p. 1; Visser (n 65). p. 6; and Ed Baden-powell and Rachael Heeley, ‘Entertainment Law Review
Copyright in the Digital Single Market - Long-Debated Directive Approved’ (2019) 30(5) Ent. L.R. 143. p. 3
80
Eleonora Rosati, ‘Lost in (Mis-)Translation: When IP Law Doesn’t Always Mean What It Says’ (2019) 14
Journal of Intellectual Property Law & Practice 587.
20

mayores esfuerzos” (greatest efforts), and the Italian version requires “i massimi sforzi”
(greatest efforts). Other versions require “all efforts”. These differences will present
challenges in transposing, compliance, judicial interpretation and application of the resulting
national provisions.81
2.5. Exceptions and limitations (art. 17.6 - 17.8)
Article 17.6 applies to new OCSSPs which have been available to the public in the EU for less
than three years and which have an annual turnover bellow EUR 10 million (e.g. start-ups).
OCSSPs who meet these cumulative conditions do not need to demonstrate compliance with
all the conditions in Article 17.4 to avoid liability. They only have to demonstrate they have:
(a) made best efforts to obtain authorisation; and –the first part of point (c)– acted
expeditiously, upon notice, to disable access to the notified works or to remove those works
from their websites (notice-and-takedown).
Therefore, Article 17.6 provides an exemption to small, new OCSSPs from the two most
important conditions of Article 17.4. They do not have to demonstrate that they have: (b)
made best efforts to ensure the unavailability of specific works for which the right-holders
have provided the relevant and necessary information; and –the second part of point (c)–
made best efforts to prevent the future upload of unauthorised works notified by right-
holders (notice-and-stay-down). These are the condition that indirectly encourage OCSSPs to
use filtering measures to prevent liability for infringing user-generated content. Small, new
OCSSPs will have to seek licenses and implement a “notice-and-takedown” mechanism, but
they will not have to implement filtering systems or implement a “notice-and-stay-down”
mechanism to prevent liability.
However, Article 17.6 also states that if the average number of monthly unique visitors of such
service providers exceeds 5 million, they will also have to demonstrate the second part of
Article 17.4c, that they have made best efforts to prevent future uploads of the notified work
for which the right-holders have provided relevant and necessary information. Therefore,
small, new OCSSPs that are popular enough to have more than 5 million monthly unique
visitors will also be encouraged to use filtering systems.
Article 17.7, paragraph 1, states that the cooperation between OCSSPs and right-holders shall
not result in the prevention of the availability of works uploaded by users, which do not
infringe copyright, including where such works are covered by an exception or limitation. This
paragraph is simply stating that over-blocking “shall” not happen, but it does not explain how
Member States will ensure this in practice.
Article 17.7, paragraph 2, provides that Member States shall ensure that users can rely on the
following exceptions and limitations: (a) quotation, criticism, review (Article 5.3d of the
InfoSoc Directive); and (b) use for the purpose of caricature, parody or pastiche (Article 5.3k
81
ibid.
21

of the InfoSoc Directive). This paragraph is slightly more precise, but it does not really explain
how to ensure this in practice.
Recital 70 notes that steps taken by OCSSPs in cooperation with right-holders should be
without prejudice to the application of exceptions or limitations to copyright, including in
particular, those which guarantee the freedom of expression of users. This is an attempt of
the EU legislator to strike a balance between the relevant fundamental rights in the ECFR, in
particular, freedom of expression and the right to property, including intellectual property.
Interestingly, while Article 17.7 and Recital 70 aim to ensure the availability of works covered
by an exception or limitation to copyright, Article 17.4 requires “best efforts” from OCSSPs to
ensure the unavailability of works not covered by an exception or limitation. Arguably, the
former obligation will not be as efficient as the latter. While OCSSPs risk liability for not
complying, Member States can only provide users who see their content removed with the
transposition of a complaint and redress mechanism (Article 17.9), which will be analysed in
the next section.
Article 17.8, paragraph 1, states that “the application of this Article [17] shall not lead to any
general monitoring obligation”. This seems impossible to attain. The only interpretation which
does not lead to this Article imposing a general monitoring obligation is to assume that the
obligation is not general because it only applies to “specific works” for which right-holders
have provided the necessary information to monitor (Article 17.4).82 However, unless OCSSPs
have authorisation to use all the content their users may upload, which is unlikely, they will
need to monitor all content from all users to comply with the obligations in Article 17.4 and
avoid liability.83 Therefore, this provision may prove meaningless in practice.84
Article 17.8, paragraph 2, states that OCSSPs shall provide right-holders, at their request, with
adequate information on the functioning of their practices with regards to the cooperation
referred to in Article 17.4 and, where licensing agreements are concluded, information on the
use of content covered by the agreements. Therefore, OCSSPs will have to prove to right-
holders that they are complying with their obligations set out in Article 17.4 and provide them
with the necessary information to scrutinise their practices.
2.6. Complaint and redress mechanism (art. 17.9)
Article 17.9 and Recital 70 aim to provide a mechanism to tackle the inevitable disputes that
will arise over the removal of content.
Article 17.9, paragraph 1, states that OCSSPs will put in place an effective and expeditious
complaint and redress mechanism that is available to their users in the event of disputes over
the disabling or removal of works uploaded by them. Recital 70 provides that this mechanism
82
Visser (n 65). p. 8
83
84
Kuczerawy (n 62).; and Frosio, ‘To Filter or Not to Filter: That Is the Question in EU Copyright Reform’ (n 11).
p. 129 referring to Scalet v Sabam (C-70/10) [2011] and Sabam v Netlog (C-360/109) [2012]
22

should be available to users especially when the removed content could benefit from an
exception or limitation to copyright.
Article 17.9, paragraph 2, states that complaints shall be processed without undue delay, and
decisions to disable access to or remove uploaded content shall be subject to human review.
Processing complaints without undue delay and taking decisions subject to human review is
crucial. It is worth clarifying, however, that this will happen while the content is not online.
Article 17.9, paragraph 2, proceeds: Member States shall ensure that out-of-court redress
mechanisms are available for the settlement of disputes. Therefore, Member States will have
to create an additional “out-of-court redress mechanisms”, apart from the one that OCSSPs
will have to put in place. If the number of disputes is high, this provision may require a
substantial investment by Member States.85 Article 17.9, paragraph 2, finishes providing that
Member States shall ensure that users have access to a court or another relevant judicial
authority to assert the use of an exception or limitation to copyright.
Article 17.9, paragraph 3, states that the Copyright Directive shall not lead to any identification
of individual users nor to the processing of their personal data. However, it is not entirely clear
how a complaint and redress mechanism would work successfully if users who file complaints
are not identified, processing their personal data connected to their profiles, to prove the link
between the removed content and the users who uploaded it. This provision may prove
meaningless in practice.
Article 17.9, paragraph 4, states that OCSSPs shall inform users in their terms and conditions
that they can use works under exceptions or limitations to copyright provided for in Union
law. Recital 70 rightly observes that users should be allowed to upload content generated by
them for the purposes of quotation, criticism, review, caricature, parody or pastiche
(exceptions and limitations to copyright).
In summary, Article 17.9 and Recital 70 provide a complaint and redress mechanism to assure
users with regard to concerns about the filtering and unlawful takedown of their non-
infringing content. However, it remains to be seen how “effective and expeditious” this
complaint and redress mechanism will be in practice.86
2.7. Stakeholder dialogues (art. 17.10)
Article 17.10 provides that, as of June 2019, the Commission, in cooperation with the Member
States, shall organise stakeholder dialogues to discuss best practices for cooperation between
OCSSPs and right-holders. The Commission shall, in consultation with OCSSPs, right-holders,
users’ organisations, and other relevant stakeholders, and taking into account the result of
the stakeholder dialogues, issue guidance on the application of Article 17, in particular
regarding Article 17.4. When discussing best practice, special account shall be taken of the
need to balance fundamental rights and of the use of exceptions and limitations. For the
85
Visser (n 65). p. 10
86
ibid. p. 9
23

purpose of these dialogues, users’ organisations shall have access to adequate information
from OCSSPs on the functioning of their practices with regards to Article 17.4.
Considering the complexity of Article 17, organising stakeholder dialogues in order to issue
guidance on its application would be useful. Stakeholder dialogues would be helpful to ensure
that Member States transpose Article 17 uniformly.87 For the purpose of Article 17.4, it would
be helpful that stakeholders defined what the “best effort” requirement entails in each
situation, what “relevant and necessary” information needs to be provided to clearly identify
works, and how OCSSPs can prevent the unavailability of works or implement a notice-and-
stay-down mechanism without indiscriminately filtering their networks. Given that OCSSPs
will probably use content recognition technology, it will also be helpful to evaluate whether
there is still a need for development of this technology, in particular regarding the recognition
of uses under exceptions and limitations.88
Arguably, however, the contradicting objectives and obligations that Article 17 imposes and
which stakeholders are invited to discuss will eventually become a matter for debate for
Member States in the transposition procedure and ultimately for the courts in individual
cases, particularly because stakeholders could not agree in the first place, and this is the raison
d'être for Article 17.
87
88
ibid. p. 9
24

Chapter 3. How to implement the new rules
3.1. Implementing the Copyright Directive
The DSM is a shared aspiration and the Copyright Directive is one of the central measures aim
at rearranging and harmonise the market. However, in the legislative process, the internet
was identified as a digital threat rather than a digital opportunity. The secondary or
negligence-based liability of OCSSPs discourse shifted to a strict liability or responsibility
discourse to incentivise OCSSPs to police allegedly infringing activities on the internet. The EU
Commission aligned its approach with the globalized, ongoing trend that inclines towards the
imposition of proactive monitoring and filtering obligations on OCSSPs, enlisting them as the
Internet police. Implementing proactive monitoring and “notice-and-stay-down” regimes is
definitely a step in that direction. Algorithmic enforcement by OCSSPs will replace due process
and fundamental guarantees by delegated agencies or the judiciary.89 This is a significant
transformation of the function of copyright law, which will serve to justify censorship instead
of serving as an engine for content creation and dissemination.90
In addition, the narrative behind the legislation was strongly criticised for building upon
governmental and industry assumptions and ignoring empirical evidence. Overlooking
empirical evidence in a copyright reform and moving forward without an impact assessment
that considers all evidence and possible narratives might result in a legislation that proves
obsolete before being implemented.91
Due to these political issues, the legislative process concluded with an extremely complex text.
There is a risk that Member States will keep debating for another decade about exactly what
was agreed upon in the text, especially given the fact that some Member States continue to
hold strong views against some of the rules, even now that the legislative process is over. This
may lead to diverging national transposition which would undermine legal certainty and the
competitive environment in the EU online market to the detriment of the DSM.92
A number of academics organised an open, fair, and respectful debate without any industry
funding in the hope that these risks can be minimized. They brought academics and
stakeholders from all sides of the opinion spectrum into a conversation about the important
questions of the implementation stage. They also invited the Member States’ representatives
89
Frosio, ‘Reforming Intermediary Liability in the Platform Economy: A European Digital Single Market Strategy’
(n 38). pp. 27 and 45; Christophe Geiger and others, ‘Monitoring and Filtering: European Reform or Global
Trend?’ (2019) 05 Center for International Intellectual Property Studies Research Paper Series 1. p.29;
Montagnani and Montagnani (n 61).; and Maria Montagnani and Alina Trapova, ‘New Obligations for Internet
Intermediaries in the Digital Single Market – Safe Harbours in Turmoil?’ (2019) 22 Journal of Internet Law 3. pp.
7-8
90
Martin Senftleben, ‘Bermuda Triangle – Licensing , Filtering and Privileging User-Generated Content Under
the New Directive on Copyright in the Digital Single Market’ [2019] SSRN Electronic Journal 1
91
Frosio, ‘To Filter or Not to Filter: That Is the Question in EU Copyright Reform’ (n 11). p. 134
92
Martin Husovec and Martin Kretschmer, ‘European Copyright Roundtables: Implementing the Digital Single
Market Directive’ (2019) <http://copyrightblog.kluweriplaw.com/2019/06/12/european-copyright-
roundtables-implementing-the-digital-single-market-directive/>.
25

and offered them the opportunity to interact with experts to lower the risk of national
fragmentation.93 The aim of the debate was to shed light on the most controversial questions
of Article 17 so that Member States can make their own informed choices in the transposition
procedure and OCSSPs know what they can reasonably be expected to do, taking into account
safeguards for users’ fundamental rights.
In order to flag the options and pitfalls of Article 17, the most controversial questions will be
analysed in the coming sections as follows: general issues, licensing obligations, preventive
obligations, and over-blocking.
3.2. General issues
Article 17 and the relevant Recitals constitute a maze of complex rules which need to be read
against the backdrop of existing case law.
Firstly, it is essential to determine which service providers would fall under the scope of the
provision that defines the targeted online service providers (Article 2.6 of the Copyright
Directive). It is not clear which service providers are in the grey area. Article 17 targets Internet
giants, such as YouTube or Facebook. However, if other service providers are caught, the
effects of Article 17 may have unintended reach, such as hindering innovation and market
entry. In order to prevent such negative effects and provide legal certainty, consensus should
be reached regarding the scope and limits of the definition in Article 2.6 of the Copyright
Directive.
Secondly, it is crucial to explore how Article 17 works in the context of exclusive rights and
intermediary liability law in order to establish to what extent Article 17 amends, complements,
or interplays with the InfoSoc Directive, the ECD, and the relevant case law of the CJEU.94
There are three options: (1) Article 17 is just a liability mitigation mechanism that does not
extend Article 3 of the InfoSoc Directive in any way but depends on its scope and relevant case
law; (2) Article 17 is an extension of Article 3 of the InfoSoc Directive, which applies where
there is a legal presumption that Article 17 provision is fulfilled; or (3) Article 17 is a completely
new right –also called communication to the public–, a sui generis exclusive right with its own
conditions and liability mitigation mechanisms.95
From the political debate and the text of the Copyright Directive, it seems that it is almost
impossible to argue for the first option. Article 17 is full of liability language regarding OCSSPs,
but not as a mitigation mechanism. It is argued that Article acts as a lex specialis to Article 3
of the InfoSoc Directive and Article 14 of the ECD, providing its own conditions and liability
mitigation mechanisms. Service providers that are not caught under Article 17 could still be
liable under Article 3 of the InfoSoc Directive or benefit from the hosting safe harbour in
93
ibid.
94
ibid.
95
Martin Husovec and others, ‘The European Copyright Roundtable’ (2019)
<https://www.youtube.com/channel/UCl1OA6-H9MTCJJBPvTn4LLw>.
26

Article 14 of the ECD. Following this argument, the second option cannot be upheld either:
Article 17 is not an extension of, nor it is linked to Article 3 of the Infosoc Directive and its case
law. Therefore, as the third option suggests, Article 17 is a completely new right, a sui generis
exclusive right to communication to the public with its own conditions and liability mitigation
mechanisms.96
In recent years, the CJEU has developed its case law on Article 3 of the InfoSoc Directive in
different directions: the re-communication of an authorised communication (SGAE; Svensson;
Reha Training; VCAST; and Reckhoff) and the re-communication of an unauthorised
communication (GS Media, Filmspeler, and the Pirate Bay).97 The latter cases arguably built a
different type of test in the case law that is reminiscent of secondary liability situations: 1)
knowledge standards for the determination of infringement; 2) lower threshold of volition
(“essential” instead of “indispensable”); and potentially 3) refuse to apply exceptions and
limitations. GS Media introduced a mandatory knowledge standard into Article 3 of the
InfoSoc Directive and the Pirate Bay case extended the volition standard from “indispensable”
intervention to “essential” interventions, thus broadening the scope of Article 3 of the InfoSoc
Directive.98
Although Referrals from the German court Bundesgerichtshof (YouTube and Elsevier) and from
the Austrian court Oberster Gerichtshof (Puls 4 TV) –pending at the time of righting— may give
the CJEU a chance to further explain these criteria, it is necessary to figure out how article 17
will interact with the current case law in order to define its nature.99
Assuming that Article 17 is a new sui generis right, a bifurcation of the case law is possible for
OCSSPs in the context of Article 17, while for other service providers, secondary liability case
law would apply (GS Media, Filmspeler and the Pirate Bay).100 Otherwise, if Article 17 is not a
new sui generis right, we need to consider what conditions of the current case law may apply
and what are the consequences on Article 3 of the InfoSoc Directive.101
Some academics have argued that the interplay between Article 17 and Articles 3 of the
InfoSoc Directive and 14 of the ECD cannot be established because the CJEU has not yet
determined it in the context of some OCSSPs.102 They argue that Article 17 is not as
96
ibid.; and Husovec (n 64). p. 22
97
Husovec (n 64). p. 11 referring to SGAE v Rafael Hoteles SA (C-306/05) [2006]; Svensson v Retriever Sverige
AB (C-466/12) [2014]; Reha Training v Gema (C-117/15) [2016]; VCAST Limited v R.T.I SpA (C-265/16) [2016];
Land Nordrhein-Westfalen v Dirk Reckhoff (C-161/17) [2018]; GS Media v Sanoma (C-160/15) [2016]; Stichting
Brein v Jack Frederik Wullems (Filmspeler) (C-527/15) [2017]; and Stichting Brein v Ziggo BV (Pirate Bay) (C-
610/15) [2017]
98
ibid. p. 12
99
Referral C-682/18 (YouTube, 6 November 2018); Referral C-683/18 (Elsevier, 6 November 2018) and Referral
C-500/19 (Puls 4 TV, 2019)
100
GS Media v Sanoma (C-160/15) [2016]; Stichting Brein v Jack Frederik Wullems (Filmspeler) (C-527/15)
[2017]; and Stichting Brein v Ziggo BV (Pirate Bay) (C-610/15) [2017]
101
Husovec and Kretschmer (n 92).
102
Husovec and others (n 95).
27

revolutionary as some academics have claimed, because it is in line with the path that the
CJEU has taken in its secondary liability case law (GS Media, Filmspeler and the Pirate Bay).103
The core problem is the knowledge requirement (Article 14 ECD) if OCSSPs are to be held liable
for infringing content uploaded by their users. Article 17 does not provide any knowledge
requirement. However, specific knowledge of the infringing nature of a work is not a good
determinator of liability in the digital era because it favours the careless services over the
more diligent ones. The more automated the service gets, the less practical the knowledge
requirement is. For this reason, the CJEU has developed a normative concept of abstract
knowledge or even negligent ignorance establishing that it is sufficient that the users of an
online platform know or ought to have known that the platform is used for infringing content.
In GS Media, the CJEU even operates with the presumption that in a commercial context there
is knowledge, unless the OCSSP is able to prove that it has diligently tried to avoid copyright
infringement. Structure-wise, this test is very similar to the liability mitigation mechanism in
Article 17.4.
The hypothesis is that Article 17 is not that different from the liability regime that could be
developed outside the scope of the Directive and if this happened –which it will not— there
would be nothing to implement.104 This development in the EU case law will not happen
because such an extension of knowledge presumption could seriously clash with the hosting
safe harbour regime in Article 14 of the ECD. In fact, Article 17 prima facie clashes with the
ECD, unless we assume it is a new sui generis right of communication to the public that acts
as a lex specialis to the ECD and the InfoSoc Directive, with its own conditions and liability
mitigation mechanisms.105
Finally, some of the questions that do not get much attention are: (1) what remedies there
will be available (e.g. injunctions or damages) if an OCSSP is liable under Article 17; and (2)
where Member States will transpose Article 17 in their national legislation. Since we consider
Article 17 to be a genuine sui generis exclusive right, all claims and remedies for copyright
infringements provided in the Enforcement Directive should be available (Articles 9 to 15 of
the Enforcement Directive). It is crucial to highlight the importance of damages, since this is
the only way that copyright-holders can get paid for the actual prejudice suffered or at least
for the amount of royalties which would have been due if the online platform had requested
authorisation. With regards to the second question, it might be convenient for Member States
to create a new chapter or section in their Copyright Acts close to the “old” communication
to the public right to include Article 17.
Article 17 imposes liability on OCSSPs, offering them two escape routes: either they obtain an
authorization from right-holders (licensing) or they take measures to prevent the availability
of infringing content in their network (preventive obligations). Since both routes are likely to
103
GS Media v Sanoma (C-160/15) [2016]; Stichting Brein v Jack Frederik Wullems (Filmspeler) (C-527/15)
[2017]; and Stichting Brein v Ziggo BV (Pirate Bay) (C-610/15) [2017]
104
Husovec and others (n 95).; and Husovec (n 64). p. 14
105
Husovec (n 64). p. 14-15
28

pose substantial difficulties in practice, they will be subject to analysis in the following
sections.106
3.3. Licensing obligation
In order to prevent liability, OCSSPs have to get authorisation from right-holders to

communicate their work to the public (Article 17.1). This provision constitutes a licensing
obligation, which is the mechanism that is supposed to deliver revenues from OCSSPs to right-
holders. This is the key motivation for Article 17 and therefore it is necessary to explore how
national legislators can realistically draft such licensing obligation, taking into consideration
industry practices for music, artistic, audio-visual and literary works.107
There is a need for a practical solution to organise and implement a licensing regime that
prevents OCSSPs from being liable for user-generated content. Otherwise, in order to prevent
liability, OCSSPs will implement strict filtering systems to remove any potentially infringing
content, which may lead to over-blocking.
The different possibilities for licensing are the following: (1) direct single licensing from
copyright-holders to OCSSPs, which would automatically include users (Article 17.2); (2)
indirect single licensing from copyright-holders to users; and (3) collective licensing, by
voluntary licensing and extended collective licensing, mandatory collective licensing, and
statutory licensing and hybrid remuneration.108 A combination of these mechanisms is
necessary to license most of the content that users uploaded to OCSSPs. Direct or indirect
single licensing is unfeasible to obtain such an umbrella license. Therefore, we are moving
towards a combination of these and collective licensing by voluntarily licensing and extended
collective licensing.
In addition, OCSSPs will face the problem of the territorial scope of the license (country by
country or pan-European licensing). OCSSPs will be required to get licenses for the States they
target, but, by their very nature, OCSSPs offer their services across borders. Country by
country licensing may not be feasible and pan-European licensing may not be facilitated. This
is not a positive incentive and it will force OCSSPs to geo-block the content in those States not
covered in the licenses, departing from the YouTube model to the Netflix one.
It may be helpful to create a universal data base where right-holders can upload their rights
and offer the opportunity to OCSSPs to check what is protected under copyright and license
against those rights. Otherwise, OCSSPs will be unaware of whether the content is protected,
who owns the copyright, who to negotiate a license with or whether there is a dispute as to
who owns that copyright.109
106
Senftleben (n 90)., pp. 2-3
107
108
Husovec and others (n 95).
109
ibid.
29

It has been argued that this licensing obligation could become very expensive and make it
difficult for some OCSSPs to stay on the web and for new OCSSPs to enter the market.110
Spotify pays around 80% of their revenue on royalties to right-holders, and they have other
expenses.111 On the contrary, it has been argued that this licensing obligation will only result
in slightly different commercial agreements than those which already exist. The largest OCSSP,
YouTube, is already engaged with many copyright-holders through different agreements.112
While this licencing obligation will empower copyright-holders in the context of negotiations,
it is important to strike a balance, otherwise OCSSPs may avoid licensing by, for instance,
blocking and not paying for the content that copyright-holders are willing to license.113 Any
fragmentation of the online offering would be highly ironic for a Copyright Directive which
aims to create a uniform law for a fully functioning Digital Single Market.114
3.4. Preventive obligations
In some cases, OCSSP will not been able to get a license because, for instance, if the copyright-
holder is unavailable, unreachable, or simply unknown.
Article 17.4 provides preventive obligations for these cases, a way out of liability if OCSSPs
demonstrate they have: (a) made “best efforts” to obtain authorisation; and (b) made “best
efforts” to ensure the unavailability of specific works for which the right-holders have
provided the relevant and necessary information; and in any event (c) acted expeditiously to
remove the copyright work from their websites (notice-and-takedown) and made “best
efforts” to prevent future uploads (notice-and-stay-down) in accordance with point (b).
Nevertheless, the vagueness of these preventive obligations requires clarification as to the

amount of information required from right-holders, how it will be provided to OCSSPs, its
accessibility, what would trigger liability, to what extent these obligations can be implemented
without indiscriminately filtering content, what tools are available to OCSSPs today, and what
potential transparency obligation can be imposed to facilitate accountability.115
Firstly, it is arguable that “best efforts” to get an authorisation (Article 17.4a) implies that
OCSSPs proactively seek licenses, instead of acting upon the request of copyright-holders.
Nevertheless, it is not clear what would amount to a diligent search to comply with “best
efforts” or if start-ups under Article 17.6 have a weaker obligation in this regard. For instance,
in the case of the music industry, there are three labels that control approximately an 80% of
the market (Sony BMG, Universal Music Group, and Warner Music Group). OCSSPs need to
know whether negotiating with them to get licenses is sufficient to constitute “best efforts”
110
Visser (n 65). p. 2
111
Barry McCarthy, ‘Form F-1 Registration Statement under the Securities Act of 1933, Spotify Technology S.A.’
(2018).
112
Enser (n 68).
113
114
Husovec (n 64). p. 25
115
30

and what would happen with the remaining 20% of content the copyright ownership of which
is unknown.
Secondly, in order for OCSSPs to comply with Article 17.4b and make “best efforts” to ensure
the unavailability of specific works for which the right-holders have provided the relevant and
necessary information, they will inevitably have to implement filtering systems. Otherwise,
considering the wide variety of work OCSSPs host, the right clearance task would be
enormous. In addition, standards to prove effective measures to prevent the availability of
work might be high, since this is an opt-out from licensing that works as an exception.
Consequently, OCSSPs will have to engage in heavy filtering to avoid the allegation that they
have taken ineffective measures.116
Thirdly, OCSSPs will have to implement a “notice-and-takedown” mechanism and a “notice-

and-stay-down” mechanism to prevent liability (Article 17.4c). If right-holders are unwilling to
license and fail to provide OCSSPs with the relevant and necessary information to ensure the
unavailability of their work –as required in Article 17.4b–, OCSSPs would be protected from
liability, as long as they comply with the “notice and takedown” obligation. The same applies
if, despite “best efforts” to reach right-holders, they are unavailable to give authorisation.
However, if an unwilling licensee who did not provide the relevant and necessary information
–as required in Article 17.4b– sends a notification with some information regarding a specific
infringement, OCSSPs will have to take the content down and consider if the information
obtained suffices to trigger the obligation to prevent future uploads (“notice-and-stay-down”)
in accordance with the standards of Article 17.4b. The interplay between the information
standards in Articles 17.4b and 17.4c is highly uncertain and will need to be clarified.117
In addition, Recital 66 suggests adjusting the relevant and necessary information standard for
different right-holders, based on size and type of work. Therefore, not only the type of
preventive obligations is a moving target, but the information standards which triggers them
is too: “the result is a mechanism with too many moving parts”.118
In order to determine whether the OCSSP has complied with the preventive obligations,
Article 17.5 provides non-exhaustive elements to be taken into account, including the
principle of proportionality. These non-exhaustive elements and the principle of
proportionality could be taken into account in order to design a tiered “best efforts”
obligation, so that smaller OCSSPs such as start-ups (Article 17.6) do not have to proactively
seek licenses or prevent future uploads of infringing content (filtering) to the extent that larger
OCSSPs are required to do.
Finally, OCSSPs will have to provide right-holders, at their request, with adequate information
on the functioning of their practices with regard to the preventive obligations (Article 17.8).
OCSSPs will have to justify the efficiency of their preventive tools: their procedure, monitoring
algorithm and underlying technology.
116
Husovec (n 64). p. 18
117
ibid. p. 18 and 23-24
118
ibid. p. 18 and 23-24
31

3.5. Over-blocking
Preventive tools such as filtering systems could lead to over-blocking (the removal of lawful
content) because they are unable to recognise exceptions or limitations to copyright.
Article 17 does not contain any strong incentive or strict obligation to prevent over-blocking.
It provides that Member States shall ensure that users are able to rely on copyright exceptions
and limitations (Article 17.7), but the scope of this obligation and consequences of insufficient
support remain unclear.119 In addition, Article 17.9 provides that: (1) OCSSPs shall put in place
an effective and expeditious complaint and redress mechanism that is available to users in the
event of disputes over the removal of content; and (2) Member States shall ensure that out-
of-court redress mechanisms are available and that users have access to a court to assert the
use of an exception or limitation to copyright. However, OCSSPs might choose to over-block
rather than under-block and be exposed to liability for copyright infringement. A dispute
resolution mechanism will be available for users but all disputes will be solved while their
content is blocked.
Some questions arise in light of these provisions, such as whether OCSSPs will be obliged to
carry content subject to exceptions and limitations, what it means to allow users to “rely on”
or “assert the use of” an exception or limitation and how this can be effectively implemented,
who will bear the cost of the complaint and redress mechanism in cases where over-removal
mistakes occur, should OCSSPs be obliged to pay a fee to incentivise reasonable blocking, what
models of alternative dispute resolution are available for this purpose (e.g. procedures at
European level in consumer law or domain name law) and what transparency obligations
should govern these procedures, should the right to request information be extended to
users, and what mechanism should Member States adopt to tackle any systemic violation of
freedom of expression.120
In order to preserve users’ autonomy and fundamental rights, the transposition of Article 17
has to sufficiently incentivise quality in preventive efforts and provide a mechanism to follow-
up the process of dispute resolution, which ensures compliance with freedom of expression
safeguards.121 OCSSPs do not decide what is legal or not, that is what the complaint and
redress mechanism is for. However, evidence from the equivalent system in the United States
shows that users are unlikely to file complaints. In addition, if disputes are not solved relatively
quickly, the complaint and redress mechanism will be incapable of safeguarding users’
fundamental right of freedom of expression.122
Making OCSSPs pay fees for over-blocking or imposing on them the costs of the complaint and
redress mechanism will probably not prevent OCSSPs from implementing filtering systems
that may lead to over-blocking, because the risk of liability for infringement is worse. A
solution to this issue could be to reverse the burden of proof of the complaint and redress
119
Senftleben (n 90). p. 8
120
121
ibid.
122
Senftleben (n 90). p. 9
32

mechanism. Users should not bear the burden of protecting themselves and their freedom of
expression. They should be informed in what situations their content falls under an exception
or limitation to copyright and have the opportunity to confirm that this is the case while the
content stays online, especially where the similarity with the protected work identified by the
filtering system is only 15 or 20%. In the current digital market, time is of essence and restating
the content, apologising and compensating is not always enough.
33

CONCLUSIONS
Due to a controversial legislative process, Article 17 and its relevant Recitals resulted in an
extremely complex legal text, which interacts with many other provisions of the law and has
to be read against the existing case law.
Article 17 makes online platforms liable for infringing user-generated content in order to
either force them into licensing agreements with copyright-holders –to allegedly close the
value gap– or indirectly make them use content recognition technology to ensure protection
of works –to arguably privatise the enforcement of illegal content online.
Academics have claimed that this provision is incompatible with the EU acquis and that tries
to indirectly amend it, hindering digital innovation and users’ participation. Moreover, it has
been claimed that empirical evidence supporting Article 17 was never provided and contrary
empirical evidence was ignored. Overlooking empirical evidence in a copyright reform might
result in legislation that proves obsolete before being implemented.
In order to shed light on the main controversial issues, Article 17 has been analysed in relation
to (1) its scope (2) the exclusive right of communication to the public, intermediary liability
law, (3) licensing obligations, (4) preventive obligations, and (5) over-blocking.
(1) It is not clear what service providers could eventually fall under the scope of Article 17. The
Copyright Directive targets large service providers such as YouTube and Facebook and it
explicitly excludes a number of different service providers. However, it fails to clarify its scope.
The risk for OCSSPs of being unexpectedly caught under the scope of Article 17 will hinder
innovation and market entry.
(2) In the context of exclusive rights and intermediary liability law, it has been argued that
Article 17 is not an extension of the exclusive right to communication to the public, but a
completely new right, a sui generis exclusive right with its own conditions and liability
mitigation mechanisms that acts as a lex specialis to the InfoSoc Directive and the ECD. Service
providers which are not caught under Article 17 could still be liable under Article 3 of the
InfoSoc Directive or benefit from the hosting safe harbour in Article 14 of the ECD. This is the
only way that Article 17 could be applied without seriously clashing with the InfoSoc Directive
and the ECD.
(3) In light of the licensing obligation that Article 17 imposes, there is a need to implement a
licensing regime that covers most of the content that users upload. A practical solution for
achieving such an umbrella license would be to combine direct and indirect single licensing
with collective licensing by voluntary licensing and extended collective licensing. However,
since OCSSPs offer their service across borders, they will also face the problem of the
territorial scope of the license. Country by country license may not be feasible and pan-
European licensing may not be facilitated. This is not a positive incentive and it may lead to
the geo-blocking of content in those States not covered by the licenses. While the licensing
obligation empowers copyright-holders in the context of negotiations, it is important to strike
a balance in order to avoid any fragmentation of the online offering.
34

(4) In order to prevent liability, OCSSPs will have complied with the preventive obligations.
They have to demonstrate they have made “best efforts” to get licenses, ensure the
unavailability of specific works for which right-holders have provided the relevant and
necessary information, and implement a “notice-and-takedown” and “stay-down”
mechanism. These conditions do not require the use of content recognition technology.
However, the only way to practically comply with such a right clearance task is to use filtering
systems. Given the vagueness of these obligations and the uncertainty as to how they work,
OCSSPs will have to engage in heavy filtering to prevent liability.
(5) At the current level of sophistication of content recognition technology, no filtering system
can recognise the use of content under an exception or limitation to copyright. This will lead
to the problem of over-blocking (the removal of lawful content). In addition, Article 17
provides no incentive or obligation to prevent over-blocking. It provides a complaint and
redress mechanism for users in the event of disputes over the removal of content. However,
evidence from the United States shows that this mechanism is unable to safeguard users’
fundamental rights. The burden of proof should be reversed and disputes over copyright
infringement should be dealt with while the content is online.
Article 17 is a significant transformation of the function of copyright law, which will serve to
justify censorship instead of serving as an engine for content creation and dissemination.
35

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MIND THE VALUE GAP.

Article 17 of the Directive on Copyright in the Digital Single Market

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CJEU Court of Justice of the European Union

Commission European Commission

DSM Digital Single Market

ECD E-Commerce Directive 2000/31/EC

ECFR European Charter of Fundamental Rights

Enforcement Directive Directive 2001/29/EC of the European Parliament and of the

InfoSoc Directive Directive 2001/29/EC of the European Parliament and of the

OCSSP Online content sharing service provider

Proposal Proposal for a Directive of the European Parliament and of the

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Chapter 1. The supposed problem and the proposed solution ............................................ 7

Chapter 2. The (un)popular Article 17 ............................................................................... 16

Chapter 3. How to implement the new rules .................................................................... 25

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1.1. Distribution of copyright-protected work and “value gap”

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1.2. A Strategy for a Digital Single Market

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1.3. Proposal for a Directive on Copyright in the Digital Single Market

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2.1. Main amendments

2.2. Definition of OCSSP (art. 2.6)

Article 2.6, paragraph 1, defines OCSSP as:

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2.3. New liability for OCSSPs (art. 17.1 – 17.3)

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2.4. Liability exemption mechanism (art. 17.4 - 17.5)

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2.5. Exceptions and limitations (art. 17.6 - 17.8)

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2.6. Complaint and redress mechanism (art. 17.9)

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2.7. Stakeholder dialogues (art. 17.10)

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3.1. Implementing the Copyright Directive

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3.2. General issues

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3.3. Licensing obligation

In order to prevent liability, OCSSPs have to get authorisation from right-holders to

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3.4. Preventive obligations

- Feindor-Schmidt U, ‘Art . 17 of the New Copyright Directive : What Must Rightholders