Chillin'Competition

Yesterday I presented at an event hosted by Sidley Austin and organised by ACT (nothing to disclose, in case you are wondering). As you know, I have been following all issues relating to geo-blocking and Digital Single Market with a lot of interest, and this event was a great occasion to exchange ideas about ongoing discussions on the interface between copyright reform and EU competition law.

The slides I used can be found here and the short note I prepared for the occasion, here.

On the interaction between copyright and competition law

One of the key points I emphasised during my presentation is that copyright cannot be understood without competition law, and vice versa. In the same way that competition law enforcement may have an impact on copyright, competition law analysis may very well change if the underlying ‘economic and legal context’ changes – just think of E.On Ruhrgas, which is one of the cases I mentioned and which exemplifies this idea particularly well.

I have lost count of the times I have explained why I believe the ongoing Pay TV case is controversial (most recently here in an event that took place last month). The case would be far less controversial if ongoing reforms are passed, and (at least some) online broadcasts become subject to the ‘country of origin’ principle, which currently applies to satellite.

On the decentralised enforcement of EU competition law

As the event was attended by copyright lawyers, I also emphasised that enforcement does not only come from the Commission. Intervention may originate in a dispute before a national court, or in a decision adopted by an NCA. After all, Coditel II and Murphy, the two key cases in this discussion, reached the Court of Justice through a preliminary reference.

This insight is important to put in perspective some of the most recent developments in the Pay TV case. There have been hints implying that the Pay TV case should be understood as a one-off initiative, and that the Commission would seek to ensure that small film producers are not affected by a finding of infringement. Insofar as the enforcement of Articles 101 and 102 TFEU is decentralised, any hints in this sense provide only limited relief – they do not and cannot rule out action at the national level (just think of what is going on in relation to online selective distribution and online hotel booking!).

On freedom of contract and secondary law

I have come to understand that it is speculated or argued in copyright circles that geo-blocking could be saved by a reference to ‘contractual freedom’ in the so-called SatCab Regulation. We competition lawyers have head these arguments before. It is clear to us that a cartel agreement – or any other agreement that runs counter to Article 101 TFEU – could not be saved in the name of contractual freedom, and that primary EU law would in any event take precedence over the Regulation, if eventually adopted.

I took an example from Microsoft to illustrate this idea. As many of you remember, there was a section in the decision devoted to whether the notion of interoperability used by the Commission was in line with the way in which the concept was defined in the Software Directive (at the time, Directive 91/250). The GC, rightly and uncontroversially, stated that this discussion was ultimately irrelevant, as a Directive cannot constrain the scope of action under Article 102 TFEU.