ITV Broadcasting Ltd & Ors v TVCatchup Ltd & Ors

There are before the court two appeals from those parts of the judgment of Floyd J (as he then was) given on 18 July 2011 and his consequential order which concern the scope of the defence provided by s.73 of the Copyright, Designs and Patents Act 1988 (“the CDPA”). He held that the defence applies in respect of the retransmission by the defendants (collectively “TVC”) of so-called qualifying services via the internet to end users within the area of intended reception of those services, including instances where the final leg of the transmission takes place by wi-fi in a domestic situation, but that the defence does not apply where the retransmission is for reception by mobile telephone.

The claimants (collectively “the broadcasters”) appeal against the first of these findings. They contend that the defence does not extend to internet transmissions and is restricted to transmissions on dedicated cable networks operated by conventional cable programme providers.

TVC appeal against the second of these findings. They argue that the defence extends to a retransmission for reception by mobile telephone.

TVC operate an internet based live stream service of broadcast television programmes, including broadcasts and films in which the broadcasters own the copyright. As the judge explained, the name TVC is inappropriate as the service provided does not now, although it did in the past, allow users to view programmes other than at substantially the same time as the original broadcasts.

So far as relevant to this appeal, the broadcasters alleged at trial that TVC had infringed the copyright in their films and their broadcasts by communicating these works to the public contrary to, respectively, s.20(1)(b) and s.20(1)(c) of the CDPA.

TVC answered the case of infringement of broadcast copyright in the following ways. First, s.20(1)(c) was invalidly enacted and ultra vires for its introduction by statutory instrument lay outside the power conferred on the Secretary of State by s.2(2)(b) of the European Communities Act 1972 (“the ECA 1972”). It was upon this issue that the judge allowed the Secretary of State for Business, Innovation and Skills to intervene. Second, TVC’s activities did not amount to communication to the public within the section. Third, in relation to the retransmission of particular qualifying services, that is to say the terrestrial broadcast channels ITV, Channel 4 and Channel 5, TVC had a defence under s.73(2)(b) and s.73(3) of the CDPA. TVC deployed the same defences to the allegation of infringement of film copyright, save for that based upon the ECA 1972.

The action came on for trial in June 2011 and, in his judgment given on 18 July 2011 ([2011] EWHC 1874 (Pat)), the judge decided as follows, so far as material to this appeal. First, he rejected the submission that s.20(1)(c) was invalidly enacted. He reached the conclusion that it arose out of and was related to the United Kingdom’s obligation under 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 2001/29”).

The judge then turned to the issue of communication to the public and the scope of s.20 of the CDPA. In this regard he considered it was not clear whether there was a communication to the public when an organisation (here, TVC), acting for its own profit, intervened and retransmitted a broadcast on the internet to members of the public who were in fact already able to access the original signal in their own homes using their own television sets. He therefore referred this issue (together with various other issues which have no bearing on this appeal) to the Court of Justice for guidance.

Finally, the judge dealt with s.73 of the CDPA. The broadcasters deployed various arguments in support of their contention that this provision was of no assistance to TVC, the first two of which the judge rejected and are not pursued on this appeal. The third ran as follows. The defence applies only to retransmission by cable, and cable must be given a narrow interpretation extending no further than is permitted by Directive 2001/29. It does not extend to retransmissions on the internet. Nor does it extend to a retransmission intended for reception by mobile telephone.

As I have indicated, the judge rejected the first part of this argument but accepted the second. He could see no reason why the cabling system inherent in the internet should not be regarded as cable for the purposes of the defence. But he also considered that, in order to take advantage of the defence, the whole or substantially the whole of the retransmission must be by cable. It therefore excluded retransmissions by cable to an antenna and then transmission for reception by mobile telephones. Lastly, he held the defence only extended to retransmission to the area in which it was intended the original broadcast should be received, a qualification which TVC accept upon this appeal.

The Court of Justice answered the various questions referred by the judge in its decision of 7 March 2013 (Case C-607/11, ITV Broadcasting Ltd & orsv TV Catchup Ltd). So far as material, it held that the concept of communication to the public within the meaning of Directive 2001/29 covered the retransmission of works contained in a terrestrial broadcast where the retransmission was made by an organisation other than the original broadcaster and by means of an internet stream made available to subscribers of that other organisation who might receive it upon logging on to its server. This was so even though those subscribers were within the area of reception of the terrestrial broadcast and might lawfully receive it on their television sets.

The matter was then listed for further hearing before the judge. On 7 October 2013 he made an order which included declarations to the effect that:

The judge also made a declaration that it was not possible to interpret s.73 so as to be compatible with Article 5(3)(o) of Directive 2001/29 which, so the broadcasters submitted, was the only provision of that directive which could provide a proper basis for such a defence.

The parties now appeal against the judge’s findings and order so far as it concerns the scope of the s.73 defence and its application in the circumstances of this case, and they do so with his permission. On 16 January 2014 I gave the Secretary of State for Business, Innovation and Skills (“the Secretary of State”) permission to intervene. His interest in these issues is clear and is confirmed by the declaration of incompatibility made by the judge. On 30 June 2014 Sir Timothy Lloyd granted Virgin Media Limited (“Virgin Media”) permission to intervene on the basis that it operates a national cable network providing retransmitted digital cable television services and relies upon s.73 to prevent its retransmissions from being an infringement of copyright. It maintains that a significant part of its business depends upon the outcome of this appeal.

The broadcasters have been represented upon this appeal by Mr James Mellor QC and Mr Quentin Cregan. As I have indicated, Mr Mellor submits that the judge wrongly interpreted the word “cable” in s.73 of the CDPA as meaning “wire” and fell into error in making the declaration referred to in paragraph 12(iii) above for, upon its proper interpretation, s.73 refers only to dedicated cable networks operated by conventional cable programme providers. Retransmissions over the internet are therefore excluded. In support of this contention he relies upon the legislative history of this provision and upon what he says was the manifest intention of the legislature to implement the terms of Directive 2001/29. He also submits that the whole of the retransmission in issue must be by cable as so understood (though he takes no point on the finding of the judge that the defence does extend to those cases in which the final leg of the transmission takes place by wi-fi within a home).

TVC and Virgin Media have been represented upon this appeal by, respectively, Mr Martin Howe QC and Mr Tom Weisselberg QC. Mr Howe (with whose submissions Mr Weisselberg agrees) submits that the contention that s.73 should be restricted to some traditional form of cable is incapable of giving rise to a rational test which can be applied by traders or the courts and is inconsistent both with the legislative history and with a purposive interpretation of the provision. He also argues that the judge fell into error in saying that TVC are not entitled to the protection of the defence in those cases where the retransmission takes place by cable to a mobile base station and is then transmitted to the mobile telephone of a subscriber within range of that station.

The Secretary of State, represented upon this appeal by Miss Charlotte May QC and Mr Jaani Riordan, largely supports the position taken by the broadcasters. I will identify any particular points relied upon by the Secretary of State as and when they arise.

It is clear that the primary issues upon this appeal arise in relation to the appeal by the broadcasters against the declaration referred to in paragraph 12(iii) above. It is convenient to address them by setting out the legislative framework, then explaining the legislative history, and finally considering the issues raised by Directive 2001/29 and other elements of the European Union acquis. The issues raised by the TVC’s appeal are relatively self-contained and most easily considered in the light of the foregoing.

Consideration of the CDPA in its current form must begin with s.6 and the definition of broadcasts. This is now broad enough to encompass certain transmissions made on cable or other material carriers, as I will explain, and it reads, so far as relevant:

“6.

Broadcasts

(1)

In this Part a “broadcast” means an electronic transmission of visual images, sounds or other information which -

(a)

is transmitted for simultaneous reception by members of the public and is capable of being lawfully received by them, or

(b)

is transmitted at a time determined solely by the person making the transmission for presentation to members of the public,

and which is not excepted by subsection (1A); and references to broadcasting shall be construed accordingly.

(1A) Excepted from the definition of “broadcast” is any internet transmission unless it is -

(a)

a transmission taking place simultaneously on the internet and by other means,

(b)

a concurrent transmission of a live event, or

(c)

a transmission of recorded moving images or sounds forming part of a programme service offered by the person responsible for making the transmission, being a service in which programmes are transmitted at scheduled times determined by that person.”

The relevant restricted act is that of communication to the public, as provided for in s.20:

“20.

Infringement by communication to the public

(1)

The communication to the public of the work is an act restricted by the copyright in—

(a)

a literary, dramatic, musical or artistic work,

(b)

a sound recording or film, or

(c)

a broadcast.

(2)

References in this Part to communication to the public are to communication to the public by electronic transmission, and in relation to a work include—

(a)

the broadcasting of the work;

(b)

the making available to the public of the work by electronic transmission in such a way that members of the public may access it from a place and at a time individually chosen by them.”

It is accepted by TVC that, in light of the guidance given by the Court of Justice in Case C-607/11, the retransmission of broadcasts by sending them in streams over the internet to their individual subscribers does fall within the scope of s.20.

That brings me to the crucial provision, that is to say s.73, and the scope of the defence it affords. It reads, so far as relevant:

“73.

Reception and retransmission of wireless broadcast by cable

(1)

This section applies where a wireless broadcast made from a place in the United Kingdom is received and immediately re-transmitted by cable.

(2)

The copyright in the broadcast is not infringed—

(a)

if the re-transmission by cable is in pursuance of a relevant requirement, or

(b)

if and to the extent that the broadcast is made for reception in the area in which it is re-transmitted by cable and forms part of a qualifying service.

(3)

The copyright in any work included in the broadcast is not infringed if and to the extent that the broadcast is made for reception in the area in which it is re-transmitted by cable; but where the making of the broadcast was an infringement of the copyright in the work, the fact that the broadcast was re-transmitted by cable shall be taken into account in assessing the damages for that infringement.

(4)

Where—

(a)

the re-transmission by cable is in pursuance of a relevant requirement, but

(b)

to any extent, the area in which the re-transmission by cable takes place (“the cable area”) falls outside the area for reception in which the broadcast is made (“the broadcast area”),

the re-transmission by cable (to the extent that it is provided for so much of the cable area as falls outside the broadcast area) of any work included in the broadcast shall, subject to subsection (5), be treated as licensed by the owner of the copyright in the work, subject only to the payment to him by the person making the broadcast of such reasonable royalty or other payment in respect of the re-transmission by cable of the broadcast as may be agreed or determined in default of agreement by the Copyright Tribunal.

(5)

Subsection (4) does not apply if, or to the extent that, the re-transmission of the work by cable is (apart from that subsection) licensed by the owner of the copyright in the work.

(6)

In this section “qualifying service” means, subject to subsection (8), any of the following services—

(a)

a regional or national Channel 3 service,

(b)

Channel 4, Channel 5 and S4C,

(c)

the public teletext service,

(d)

S4C Digital, and

(e)

the television broadcasting services and teletext service of the British Broadcasting Corporation;

and expressions used in this subsection have the same meanings as in Part 3 of the Communications Act 2003.

(7)

In this section “relevant requirement” means a requirement imposed by a general condition (within the meaning of Chapter 1 of Part 2 of the Communications Act 2003) the setting of which is authorised under section 64 of that Act (must-carry obligations).

…

(13)

In this section references to re-transmission by cable include the transmission of microwave energy between terrestrial fixed points.”

I would make the following observations about this section at this stage. First, it applies only to the reception of wireless broadcasts made from a place in the United Kingdom and their immediate retransmission by cable (subsection (1)). Second, it affords a defence both to an allegation of infringement of copyright in the broadcast (subsection (2)) and of the copyright in any work included in the broadcast (subsection (3)), subject of course to the other requirements of the section. Third, it applies in the two situations identified in subsection (2), commonly referred to as the “must carry” and “reception area” exceptions. In this appeal we are concerned only with the “reception area” exception, and this is restricted to the retransmission of qualifying services as defined in subsection (6).

I must set this out in some detail in light of the wide ranging submissions made to us both in writing and in the course of the appeal hearing itself, and I gratefully acknowledge the assistance we have received from counsel in this regard. I begin with the Berne Convention as revised in 1948. This regulates the use of what are known as Berne works, including films involving creative input, in the context of broadcasting. Countries of the Union are required to give authors of such works the right to authorise their inclusion in broadcasts and, by Article 11bis (1)(ii), in:

“any communication to the public by wire or by rebroadcasting of the broadcast of the work, when this communication is made by an organisation other than the original one;”

This provision appears to distinguish communications by wire from those which are transmitted in space without any guide or conductor. The term “wire” therefore seems to be used in a general sense so as to include any means by which signals may be conducted along constrained paths. Similarly, the expression “any communication to the public by wire” appears broad enough to encompass both analogue and digital transmissions, and has been so understood by the respected academic commentators Sam Ricketson and Jane Ginsberg (International Copyright and Neighbouring Rights, 2^nd edition, vol.1, para 12.37, Oxford University Press, 2006). It is also to be noted that this particular right of control is concerned with communications to the public by wire or by rebroadcasting of works included in an original broadcast. As Mr Howe pointed out, it is not concerned with the inclusion of a work in an original cable service which is not retransmitting a broadcast.

The Copyright Act 1956 (“the 1956 Act”) gave effect to this provision of the Berne Convention (and in fact went rather further) by rendering the transmission of Berne works to subscribers to a diffusion service an infringing act (see, in particular, s.13(5)(d) in respect of films). This activity was defined in s.48(3) in these terms:

“(3)

References in this Act to the transmission of a work or other subject-matter to subscribers to a diffusion service are references to the transmission thereof in the course of a service of distributing broadcast programmes, or other programmes (whether provided by the person operating the service or other persons), over wires, or other paths provided by a material substance, to the premises of subscribers to the service; and for the purposes of this Act, where a work or other subject-matter is so transmitted –

(a)

the person operating the service (that is to say, the person who, in the agreements with subscribers to the service, undertakes to provide them with the service, whether he is the person who transmits the programmes or not) shall be taken to be the person causing the work or other subject-matter to be so transmitted, and

(b)

no person, other than the person operating the service, shall be taken to be causing it to be so transmitted, notwithstanding that he provides any facilities for the transmission of the programmes:

Provided that, for the purposes of this subsection, and of references to which this subsection applies, no account shall be taken of a service of distributing broadcast or other programmes, where the service is only incidental to a business of keeping or letting premises where persons reside or sleep, and is operated as part of the amenities provided exclusively or mainly for residents or inmates therein.”

It is to be noted that such transmissions included transmissions over wires or other paths provided by any material substance to the premises of subscribers to the service, and were to be contrasted with broadcasting which meant transmission by wireless telegraphy (s.48(2)).

The rights so conferred were, however, limited so as to exclude the transmission to subscribers to a diffusion service of broadcasts made by the British Broadcasting Corporation or by the Independent Television Authority, referred to in the 1956 Act as, respectively, “the Corporation” and “the Authority”. Section 40(3) provided:

“Where a television broadcast or sound broadcast is made by the Corporation or the Authority, and the broadcast is an authorised broadcast, any person who, by the reception of the broadcast, causes a programme to be transmitted to subscribers to a diffusion service, being a programme comprising a literary, dramatic or musical work, or an adaptation of such a work, or an artistic work, or a cinematograph film, shall be in the like position, in any proceedings for infringement of the copyright (if any) in the work or film, as if he had been the holder of a licence granted by the owner of that copyright to include the work, adaptation or film in any programme caused to be transmitted by him to subscribers to that service by the reception of the broadcast.”

Here one can see the origin of the defence now embodied in s.73 of the CDPA. I would emphasise that the defence applied to the retransmission of authorised broadcasts to subscribers to a diffusion service, that is to say, a service of distributing broadcast programmes over wires or other paths provided by any material substance to the premises of subscribers to the service.

The Whitford Committee Report of March 1977 (Cmnd 6732) (“the Report”) considered diffusion services in chapter 8. In its introduction to its discussion of these services, the Report recognised the distinction between broadcast transmissions where signals were transmitted through the air and the transmission of programmes by wire diffusion where signals were distributed along cables or other similar paths. It noted that diffusion networks generally distributed broadcast programmes which were locally receivable simultaneously over the air and so were, in effect, a common or community aerial providing subscribers to the service with no more in the way of programmes than they could receive with individual aerials; and observed that this had obvious benefits in that, in some areas, the use of individual aerials was banned on amenity grounds and, in others, reception by individual aerials might be poor due to the presence of intervening hills or buildings. The Report gave careful consideration to the exception provided for in s.40(3) and concluded that it should be retained but, in so far as it applied to rights in broadcasts, in slightly restricted form:

“446.

Accordingly we have come to the conclusion that the exceptions provided for in Subsections (3), (4) and (5) of Section 40 of the 1956 Act should continue to apply. As to the rights enjoyed by broadcasting organisations we think that they too should be given a right to restrict the communication of their broadcasts to the public by wire (ie Section 14 to include that as a restricted act), in common with authors and composers generally, but in this case, with an exception slightly more restricted than that presently provided by Section 40(3). This exception should, we think, permit the communication to the public by wire of authorised broadcasts by the BBC or the IBA without infringing either the author’s or the broadcaster’s rights, but only in so far as the communication is of the whole broadcast, is simultaneous with the original broadcast and is only within an area in which the broadcast is normally receivable or intended to be receivable directly off-air. The provision would thus not allow any modification whatsoever of broadcasts, as by the insertion or substitution of the diffuser’s own advertisements, nor would it cater for the distribution by wire of out-of-area broadcasts, although these might be arranged by negotiation between the parties, as no doubt they would be in suitable cases. This exception should not apply to foreign broadcasts.”

In the event, however, no material amendment was made to the 1956 Act until the Cable and Broadcasting Act 1984 (“the 1984 Act”). This introduced the new concept of “cable programme services”. These were defined in s.2(1) of the 1984 Act in broad terms but so as to exclude transmissions for reception at multiple locations by wireless telegraphy:

“2(1) In this Act “cable programme service” means a service which consists wholly or mainly in the sending by any person, by means of a telecommunication system (whether run by him or by any other person), of sounds or visual images or both either –

(a)

for reception, otherwise than by wireless telegraphy, at two or more places in the United Kingdom, whether they are so sent for simultaneous reception or at different times in response to requests made by different users of the service; or

(b)

for reception, by whatever means, at a place in the United Kingdom for the purpose of their being presented there either to members of the public or to any group of persons.”

Mr Howe submits and I accept that there was nothing here to limit the scope of the definition to services provided on dedicated cables. Nor did it exclude all interactive services. To the contrary, they were plainly included for s.2(1)(a) referred to services provided in response to requests by different users. Finally, the definition was, as Mr Howe put it, “technology neutral”, in that it encompassed all services which involved the sending by means of a telecommunication system of sounds or images for reception at two or more places in the United Kingdom save by wireless telegraphy.

The 1984 Act made significant amendments to the 1956 Act. So far as relevant to this appeal, it effectively replaced “diffusion services” with “cable programme services”; it introduced a copyright, subject to the provisions of the Act, in every cable programme included in a cable programme service (as defined in the 1984 Act); it made the inclusion of a broadcast in a cable programme a restricted act; and it introduced a new s.14(8A) and a new s.40(3) and (3A) which provided parallel defences to those previously conferred by s.40(3). The amendments to s.40 warrant reproduction here:

“40(3) Where a television broadcast or sound broadcast is made by the Corporation or the Authority and the broadcast is an authorised broadcast, then, subject to subsection (3A) below, any person who, by the reception and immediate re-transmission of the broadcast, includes a programme in a cable programme service, being a programme comprising a literary, dramatic or musical work, or an adaptation of such a work, or an artistic work, or a sound recording or cinematograph film, shall be in the like position, in any proceedings for infringement of the copyright (if any) in the work, recording or film, as if he had been the holder of a licence granted by the owner of that copyright to include the work, adaptation, recording or film in any programme so included in that service.

(3A) Subsection (3) above applies only –

(a)

if the programme is included in the service in pursuance of a requirement imposed under section 13(1) of the Cable and Broadcasting Act 1984; or

(b)

if and to the extent that the broadcast is made for reception in the area in which the service is provided.”

Subsection (3A)(a) reflected a “must carry” requirement imposed by s.13, and subsection (3A)(b) the “in area” restriction foreshadowed by the Whitford Report. In due course both were carried forward into the CDPA.

That brings me to the CDPA as originally enacted. It provided by s.1(1) that copyright subsisted in accordance with Part I in, inter alia, films, broadcasts and cable programmes. Broadcasts were defined in s.6(1) in these terms:

“6(1) In this Part, a “broadcast” means a transmission by wireless telegraphy of visual images, sounds or other information which –

(a)

is capable of being lawfully received by members of the public, or

(b)

is transmitted for presentation to members of the public;

and references to broadcasting shall be construed accordingly.”

By contrast, cable programmes and cable programme services were defined in s.7 which provided, so far as relevant:

“7(1) In this Part –

“cable programme” means any item included in a cable programme service; and

“cable programme service” means a service which consists wholly or mainly in sending visual images, sounds or other information by means of a telecommunications system, otherwise than by wireless telegraphy, for reception –

(a)

at two or more places (whether for simultaneous reception or at different times in response to requests by different users), or

(b)

for presentation to members of the public,

and which is not, or so far as it is not, excepted by or under the following provisions of this section.

(2)

The following are excepted from the definition of “cable programme service” –

(a)

a service or part of a service of which it is an essential feature that while visual images, sounds or other information are being conveyed by the person providing the service there will or may be sent from each place of reception, by means of the same system or (as the case may be) the same part of it, information (other than signals sent for the operation or control of the service) for reception by the person providing the service or other persons receiving it.

…”

A number of significant points emerge from this definition. First, it was no longer tied to the 1984 Act although framed in very similar terms. Second, it was again “technology neutral” save that, as I have mentioned, it still excluded transmission by wireless telegraphy. Third, there were certain exceptions, one of which (s.7(2)(a)) is relevant to this appeal: interactive services were excluded save in so far as they involved signals sent for the operation or control of the service.

Mr Mellor contends that s.7 excluded two-way interactive internet systems altogether because it is an essential feature of such systems that, during the provision of the service, information has to be sent back to the person who is providing the service. It is, he continues, clear that the legislature intended to exclude computer networks, messaging systems and, indeed, all services provided over the internet because they all allow for the simultaneous communication of information between service-providers and service-recipients. Such systems are, says Mr Mellor, quite different from those which have a “broadcast” character, and involve point to multi-point transmissions.

It seems to me that Mr Mellor’s submissions go much too far. It is evident that this section had its origins in the 1984 Act and that it was concerned with services which consist of the sending of information by a telecommunications system (other than by wireless telegraphy) for reception at multiple locations or for presentation to the public. Subject to the exceptions which followed, that might be done using traditional cable networks or any other wired systems. Many internet services would not have satisfied these basic requirements, but some would have done.

The scope of s.7(1) is confirmed by the exceptions which followed in subsection (2). Specifically subsection (2)(a) excluded interactive services which allowed the recipient to send messages to the service provider using the same system and while the service was being provided. But importantly, this exception was itself subject to an exception: it did not apply to signals sent for the operation or control of the service. That is, of course, precisely the case in relation to the services now in issue here. TVC supply data streams in response to requests from subscribers for particular channels. No other aspect of the service is interactive. I therefore have no doubt that these services would have fallen within the scope of “cable programme services” as defined in s.7 as originally enacted. I note that my understanding of the scope of s.7 is entirely consistent with the view expressed by Lord Hamilton upon a motion for an interim interdict in the Court of Session in Shetland Times Ltd v Dr Jonathan Wills [1997] FSR 604 at pages 607 to 608 and with the obiter observations of Peter Smith J in Sony Music Entertainment (UK) Ltd v Easyinternetcafé Ltd [2003] FSR 882 at pages 891 to 892.

Returning now to the other material provisions of the CDPA as originally enacted, s.20 provided that the broadcasting of a work or its inclusion in a cable programme service was an act restricted by the copyright in, inter alia, a film or a broadcast or cable programme. But s.73 provided for an exception in the case of the reception and retransmission of broadcasts in a cable programme service, just as did ss.14(8A), 40(3) and 40(3A) of the 1956 Act:

73(1) This section applies where a broadcast made from a place in the United Kingdom is, by reception and immediate re-transmission, included in a cable programme service.

(2)

The copyright in the broadcast is not infringed –

(a)

if the inclusion is in pursuance of a requirement imposed under section 13(1) of the Cable and Broadcasting Act 1984 (duty of Cable Authority to secure inclusion in cable service of certain programmes), or

(b)

if and to the extent that the broadcast is made for reception in the area in which the cable programme service is provided and is not a satellite transmission or an encrypted transmission.

(3)

The copyright in any work included in the broadcast is not infringed –

(a)

if the inclusion is in pursuance of a requirement imposed under section 13(1) of the Cable and Broadcasting Act 1984 (duty of Cable Authority to secure inclusion in cable service of certain programmes), or

(b)

if and to the extent that the broadcast is made for reception in the area in which the cable programme service is provided;

but where the making of the broadcast was an infringement of the copyright in the work, the fact that the broadcast was re-transmitted as a programme in a cable programme service shall be taken into account in assessing the damages for that infringement.”

In my judgment the services provided by TVC and here in issue would have fallen squarely within this provision. As I have said, they would have been cable programme services within the meaning of s.7(1) and would not have been excluded by s.7(2). Further, they involve the immediate retransmission of broadcasts made for reception in the area in which they are provided, and so would have satisfied the “in area” requirement.

Amendments were made to s.73 first by the Broadcasting Act 1990 and then by the Broadcasting Act 1996, none of which has a bearing on the issues arising on this appeal. So I come now to two important directives and their implementation into domestic law: first, Council Directive 93/83 of 27 September 1993 on the coordination of certain rules concerning copyright and rights related to copyright applicable to satellite broadcasting and cable retransmission (“Directive 93/83”); and second, Directive 2001/29. Both of these are said by Mr Mellor to use the term “cable” in a limited and traditional sense, that is to say to refer to dedicated cable networks operated by conventional cable programme providers.

The purpose of Directive 93/83 is to facilitate the cross border transmission of programming and its retransmission by cable, and the establishment of mechanisms to ensure that the producers of such programmes receive a fair remuneration.

The directive explains (in recital (5)) that cross-border satellite broadcasting and the cable retransmission of programmes from other Member States is obstructed by a series of differences between national rules on copyright and (in recital (8)) that there is presently a lack of legal certainty where programmes transmitted across frontiers are fed into and retransmitted through cable networks. Particular difficulties in this regard are highlighted in recitals (10) and (11):

“(10)

Whereas at present cable operators in particular cannot be sure that they have actually acquired all the programme rights covered by such an agreement;

(11)

Whereas, lastly, parties in different Member States are not all similarly bound by obligations which prevent them from refusing without valid reason to negotiate on the acquisition of the rights necessary for cable distribution or allowing such negotiations to fail;”

The problems facing cable operators are mentioned again in recital (27):

“(27)

Whereas the cable retransmission of programmes from other Member States is an act subject to copyright and, as the case may be, rights related to copyright; whereas the cable operator must, therefore, obtain the authorization from every holder of rights in each part of the programme retransmitted; whereas, pursuant to this Directive, the authorizations should be granted contractually unless a temporary exception is provided for in the case of existing legal licence schemes;”

As Mr Howe frankly accepts, the terms of these recitals imply a focus on traditional cable systems under the control of traditional cable operators. Indeed, I think it is tolerably clear that these were the only kinds of retransmission envisaged at that time, and such is confirmed by the Commission Report of 26 July 2002 (COM (2002) 430 final).

Cable retransmissions are defined in Article 1(3):

“3.

For the purposes of this Directive, 'cable retransmission' means the simultaneous, unaltered and unabridged retransmission by a cable or microwave system for reception by the public of an initial transmission from another Member State, by wire or over the air, including that by satellite, of television or radio programmes intended for reception by the public. ”

Here, as Mr Mellor and Miss May fairly point out, it appears that a distinction has been drawn between, on the one hand, retransmission by a “cable or microwave system”, and, on the other hand, initial transmission by “wire” or “over the air”.

The cable operator then becomes the beneficiary of what is, in effect, a system of compulsory licensing of the programme rights, as Articles 8(1) and 9(1) make clear:

“Article 8

Cable retransmission right

1.

Member States shall ensure that when programmes from other Member States are retransmitted by cable in their territory the applicable copyright and related rights are observed and that such retransmission takes place on the basis of individual or collective contractual agreements between copyright owners, holders of related rights and cable operators.

…

Article 9

Exercise of the cable retransmission right

1.

Member States shall ensure that the right of copyright owners and holders or related rights to grant or refuse authorization to a cable operator for a cable retransmission may be exercised only through a collecting society.”

These provisions of Directive 93/83 were implemented into domestic law by the Copyright and Related Rights Regulations 1996 (SI 1996 No.2967) (“the 1996 Regulations”), which inserted into the CDPA a new s.144A. This is a provision upon which particular reliance has been placed by the broadcasters and the Secretary of State and so I should set it out in its original form:

“144A Collective exercise of certain rights in relation to cable re-transmission

(1)

This section applies to the right of the owner of copyright in a literary, dramatic, musical or artistic work, sound recording or film to grant or refuse authorisation for cable re-transmission of a broadcast from another EEA member state in which the work is included. That right is referred to below as “cable re-transmission right”.

(2)

Cable re-transmission right may be exercised against a cable operator only through a licensing body.

(3)

Where a copyright owner has not transferred management of his cable re-transmission right to a licensing body, the licensing body which manages rights of the same category shall be deemed to be mandated to manage his right. Where more than one licensing body manages rights of that category, he may choose which of them is deemed to be mandated to manage his right.

(4)

A copyright owner to whom subsection (3) applies has the same rights and obligations resulting from any relevant agreement between the cable operator and the licensing body as have copyright owners who have transferred management of their cable re-transmission right to that licensing body.

(5)

Any rights to which a copyright owner may be entitled by virtue of subsection (4) must be claimed within the period of three years beginning with the date of the cable re-transmission concerned.

(6)

This section does not affect any rights exercisable by the maker of the broadcast, whether in relation to the broadcast or a work included in it.

(7)

In this section – “cable operator” means a person providing a cable programme service; and

“cable re-transmission” means the reception and immediate re-transmission by way of a cable programme service of a broadcast.”

It can be seen that the section did indeed provide for the collective licensing of works included in a broadcast which is re-transmitted by cable. Focussing on the expressions “cable programme” and “cable programme service”, Miss May reminds us that these were defined in s.7 for the purposes of the whole of Part 1 of the CDPA and so, she continues, they must have had (and must still have) the same meaning in both s.144A and s.73, and further, that meaning must be the narrow one for which the broadcasters and the Secretary of State contend.

I am unable to accept this submission for it seems to me to turn the exercise of interpretation of ss.7 and 73 on its head. There is nothing at all in the 1996 Regulations to suggest that the legislature intended to amend in any way the definitions of “cable programmes” and “cable programme services” in s.7 or the scope of the defence afforded by s.73. Accordingly if, as I believe to be the case, the definitions in s.7, as enacted, were broad enough to encompass the essential service provided by TVC then nothing in the 1996 Regulations changed that position. This may or may not have an impact on the scope and interpretation of s.144A (compare the decision of the Landgericht Hamburg in decision 308 0 660/08 of 8 April 2009 Warner Bros. International Television Distribution Inc v Universal City Studios Productions LLLP), but that is not a matter before us. I am, however, in no doubt that the 1996 Regulations did not reduce the scope of the definition in s.7 or the defence afforded by s.73.

This is a measure directed to the harmonisation of copyright and related rights throughout the European Union and, in particular, the harmonisation of three rights: the reproduction right, the right of communication (and the making available) of works and other material to the public and the right of distribution. There are four recitals to which I must refer. Recital (15) discusses the steps taken by the World Intellectual Property Organisation to update the protection of copyright and other rights in the digital age:

“(15)

The Diplomatic Conference held under the auspices of the World Intellectual Property Organisation (WIPO) in December 1996 led to the adoption of two new Treaties, the ‘WIPO Copyright Treaty’ and the ‘WIPO Performances and Phonograms Treaty’, dealing respectively with the protection of authors and the protection of performers and phonogram producers. Those Treaties update the international protection for copyright and related rights significantly, not least with regard to the so-called ‘digital agenda’, and improve the means to fight piracy world-wide. The Community and a majority of Member States have already signed the Treaties and the process of making arrangements for the ratification of the Treaties by the Community and the Member States is under way. This Directive also serves to implement a number of the new international obligations.”

Then, after mention of Directive 2000/31/EC of the European Parliament and of the Council of 8 June 2000 (often referred to as the Directive on electronic commerce), there appears (with references omitted):

“(20)

This Directive is based on principles and rules already laid down in the Directives currently in force in this area, in particular Directives 91/250/EEC, 92/100/EEC, 93/83/EEC, 93/98/EEC and 96/9/EC, and it develops those principles and rules and places them in the context of the information society. The provisions of this Directive should be without prejudice to the provisions of those Directives, unless otherwise provided in this Directive.”

This recital is one upon which Mr Mellor places particular reliance for he says that all of these directives (conveniently exemplified by Directive 93/83) use the term “cable” and related expressions to refer to traditional dedicated cable systems operated by conventional cable programme providers. He continues that, as a matter of European Union law, equivalent references in Directive 2001/29 should be interpreted in exactly the same way. This is a proposition with which Mr Howe takes issue. He disputes that there is any single meaning of the term “cable” as a matter of Union law, and he maintains there is no rational basis for such an “all-purpose” concept to exist.

Recital (32) emphasises the exhaustive nature of the exceptions and limitations to the reproduction right and the right of communication to the public:

“(32)

This Directive provides for an exhaustive enumeration of exceptions and limitations to the reproduction right and the right of communication to the public. Some exceptions or limitations only apply to the reproduction right, where appropriate. This list takes due account of the different legal traditions in Member States, while, at the same time, aiming to ensure a functioning internal market. Member States should arrive at a coherent application of these exceptions and limitations, which will be assessed when reviewing implementing legislation in the future.”

Finally, recital (60) foreshadows the saving of certain existing rights:

“(60)

The protection provided under this Directive should be without prejudice to national or Community legal provisions in other areas, such as industrial property, data protection, conditional access, access to public documents, and the rule of media exploitation chronology, which may affect the protection of copyright or related rights.”

Turning now to the body of the directive, Article 1 addresses its scope and includes, at paragraph (2)(c), this saving concerning cable retransmissions:

“2.

Except in the cases referred to in Article 11, this Directive shall leave intact and shall in no way affect existing Community provisions relating to:

…

(c)

copyright and related rights applicable to broadcasting of programmes by satellite and cable retransmission; …”

The various rights to control reproduction, communication to (and making available to) the public and distribution are dealt with by Articles 2, 3 and 4 respectively. I must refer to Articles 2 and 3:

“Article 2

Reproduction right

Member States shall provide for the exclusive right to authorise or prohibit direct or indirect, temporary or permanent reproduction by any means and in any form, in whole or in part:

(a)

for authors, of their works;

(b)

for performers, of fixations of their performances;

(c)

for phonogram producers, of their phonograms;

(d)

for the producers of the first fixations of films, in respect of the original and copies of their films;

(e)

for broadcasting organisations, of fixations of their broadcasts, whether those broadcasts are transmitted by wire or over the air, including by cable or satellite.

Article 3

Right of communication to the public of works and right of making available to the public other subject-matter

1.

Member States shall provide authors with the exclusive right to authorise or prohibit any communication to the public of their works, by wire or wireless means, including the making available to the public of their works in such a way that members of the public may access them from a place and at a time individually chosen by them.

2.

Member States shall provide for the exclusive right to authorise or prohibit the making available to the public, by wire or wireless means, in such a way that members of the public may access them from a place and at a time individually chosen by them:

(a)

for performers, of fixations of their performances;

(b)

for phonogram producers, of their phonograms;

(c)

for the producers of the first fixations of films, of the original and copies of their films;

(d)

for broadcasting organisations, of fixations of their broadcasts, whether these broadcasts are transmitted by wire or over the air, including by cable or satellite.

3.

The rights referred to in paragraphs 1 and 2 shall not be exhausted by any act of communication to the public or making available to the public as set out in this Article.”

There are two points to be made about these provisions. First, Article 3(1) is intended to achieve full harmonisation of the relevant rights conferred on authors of Berne works. Member States are required to provide such authors with the exclusive right to authorise or prohibit any communication to the public of their works by wire or wireless means, and that includes communication via the internet, as the decision of the Court of Justice in Case C-607/11 makes clear. By contrast, the rights conferred on broadcasters are not subject to full harmonisation, for Article 3(2) simply requires Member States to provide such persons with the exclusive right to authorise or prohibit the making available to the public (by wire or wireless means, in such way that members of the public may access them from a place and at a time individually chosen by them) of fixations of their broadcasts. The United Kingdom has of course gone rather further in protecting broadcasters than was required by this provision, so leaving less scope for an argument that s.73 must be construed in the manner for which the broadcasters contend. It is perhaps for this reason that the broadcasters have focused their attention on the Berne works the subject of Article 3(1).

Second, Mr Mellor points to the use in Articles 2 and 3 of the phrase “whether these broadcasts are transmitted by wire or over the air, including by cable or satellite”. This, he says, makes clear that the Union legislature drew a clear distinction between “wire” and “cable” and, by the latter, meant only traditional dedicated cable systems.

Article 5 deals with permitted exceptions and limitations and, by paragraph 3(o), provides:

“3.

Member States may provide for exceptions or limitations to the rights provided for in Articles 2 and 3 in the following cases:

(o)

use in certain other cases of minor importance where exceptions or limitations already exist under national law, provided that they only concern analogue uses and do not affect the free circulation of goods and services within the Community, without prejudice to the other exceptions and limitations contained in this Article.”

There is, however, a further hurdle, for paragraph 5 imposes what is known as the Berne three step test for any such exception or limitation:

“5.

The exceptions and limitations provided for in paragraphs 1, 2, 3 and 4 shall only be applied in certain special cases which do not conflict with a normal exploitation of the work or other subject-matter and do not unreasonably prejudice the legitimate interests of the rightholder.”

Before the judge, Mr Mellor contended that this was the only “pigeon hole” into which s.73 of the CDPA could be posted, and so the section should be construed narrowly and so as to exclude digital uses. The argument has not been pursued by Mr Mellor on this appeal, and rightly so. It is not tenable for the reasons the judge gave. Put shortly, s.73 refers expressly to S4C as a qualifying service and this is a digital channel. Further, the “must carry” provisions refer to digital services.

That is not the end of the matter, however, for Article 9 reflects recital (60) and deals with the continued application of other legal provisions. It reads:

Article 9

Continued application of other legal provisions

This Directive shall be without prejudice to provisions concerning in particular patent rights, trade marks, design rights, utility models, topographies of semi-conductor products, type faces, conditional access, access to cable of broadcasting services, protection of national treasures, legal deposit requirements, laws on restrictive practices and unfair competition, trade secrets, security, confidentiality, data protection and privacy, access to public documents, the law of contract.

The scope of this Article became the focus of a good deal of argument on the appeal, and this is a matter to which I must return. But first I must describe how the directive has been implemented into national law. This has been achieved by the Copyright and Related Rights Regulations 2003 (SI 2003 No.2498) (“the 2003 Regulations”). In broad outline, the right conferred by s.20 to include a work in a broadcast or a cable programme service has been redefined as a right to communicate a work to the public (see paragraph [20] above), and such right includes the right to broadcast a work and make it available by electronic transmission in such a way that members of the public may access it from a place and at a time of their own choosing. The right is extended to authors of Berne works (so implementing Article 3(1) of the directive) and also to phonogram producers, film producers and broadcasters (so implementing and going beyond Article 3(2) of the directive).

Section 6 has been amended and redefines “broadcasts” (and “broadcasting”) in a technology neutral way as relating to transmissions by any electronic means (whether wire or wireless) for simultaneous reception by members of the public or for presentation to members of the public, but not on-demand (see paragraph [19] above). Cable programme services of this type which previously fell within s.7 have in this way been assimilated into the new s.6, and s.7 has been deleted.

There is a further aspect of s.6 which I should mention at this stage. It is clear that the legislature contemplated that internet transmissions might fall within the definition of broadcasts for they are expressly dealt with by s.6(1A). This provides that internet transmissions are not included unless they are transmissions of one of the three types set out in subsection (1A)(a), (b) or (c).

Section 73 required consequential amendments. In particular, subsection (1) has been amended to make it clear it only applies to retransmissions of wireless broadcasts; and, wherever it appeared, the expression “cable programme service”, no longer defined by s.7, has been replaced with the expression “retransmission by cable”. These are, as it seems to me, necessary changes reflecting the merger of the old ss.6 and 7 into the new s.6.

Turning now to the submissions of the parties, Mr Mellor contends first, that the term “cable” has a uniform and precise meaning in European Union law, that is to say a dedicated cable system operated by traditional cable operators. Second, Directive 2001/29 only permits limited exceptions to the communication to the public right defined in Article 3(1), namely (and so far as relevant) Article 5(3)(o) and Article 9; and neither of these exceptions encompasses or permits a defence with the scope of s.73 as TVC contend it should be interpreted. Third, the Marleasing principle of conforming interpretationrequires this court to interpret s.73 consistently with the directive. Fourth, in these circumstances we can and we should interpret s.73 as limited to the retransmission of broadcasts on traditional cable systems operated by conventional cable programme providers, and that is so whatever its scope may have been prior to the coming into force of the 2003 Regulations.

Mr Howe responds to these submissions as follows. He says first, there is no consistent use of the term “cable” in European Union law and there is no rational basis for such an all-purpose concept to exist. Second, Article 9 is a saving provision and is concerned with existing provisions of national law. Accordingly Article 9 confers on Member States the right to retain existing provisions of national law of the various kinds here referred to, including those concerning “access to cable of broadcasting services”, and so also s.73 (see, for example, Case C-306/05 Sociedad General de Autores y Editores de España (SGAE) v Rafael Hoteles SA [2006] ECR I-11519 at [31]). Third and in any event, the exercise of interpretation which Mr Mellor invites us to undertake would go beyond anything permitted by the Marleasing doctrine.

Miss May has explained to us in a note provided after the hearing that the Secretary of State’s position is that the term “cable” in Article 9 has a specific technical meaning, and that this is also the meaning of the term “cable” in s.73. The scope of both provisions is and has always been limited to traditional cable systems which exclude the internet. His secondary position is that if, prior to amendment by the 2003 Regulations, s.73 had a broader scope and extended to services provided on the internet, then a Marleasing interpretation should now be applied to it and its scope limited accordingly. His tertiary position is that if, contrary to the foregoing, the term “cable”, as used in Article 9, has a technologically neutral meaning then s.73 “can be no broader and must therefore be compatible with” Article 9.

In considering these submissions I think it convenient to begin with the scope of s.73 before its amendment by the 2003 Regulations. For the reasons I have already given, I am entirely satisfied that the expressions “cable programme” and “cable programme services” in ss.7 and 73 were not limited to programmes and services provided on dedicated cable networks operated by conventional cable programme providers and, to the contrary, were sufficiently broad to encompass the services provided by TVC in issue on this part of the appeal.

That brings me to Directive 2001/29 and to the scope of Article 9. Here I can begin with a little common ground. The parties are agreed that this is concerned with, amongst other things, existing provisions of national law, a position which is, in my view, supported by the terms of recital (60). More specifically, we are concerned with the meaning and hence the scope of the phrase “access to cable of broadcasting services” and here again I detect a measure of common ground for the parties appear to agree that it is broad enough to encompass the “must carry” aspect of s.73. But at this point the common understanding ends. I have given an indication of the parties’ general submissions but now I must summarise how they have elaborated them in relation to Article 9.

Mr Mellor contends that the phrase “access to cable of broadcasting services” is certainly not broad enough to encompass the “reception area” aspect of s.73. He also contends that the scope of the phrase is limited by the term “cable” in the manner I have described. In short, he says this term is not synonymous with the term “wire” but is rather confined to conventional cable operated by conventional cable operators. Accordingly and for these two separate though related reasons, Article 9 does not permit a defence of sufficient scope to encompass TVC’s activities.

Mr Howe submits that Article 9 is concerned with existing provisions of national law concerning access to cable of broadcasting services and, as such, is to be contrasted with Article 5 which is concerned with general exceptions and limitations to the rights provided for in Articles 2 and 3. He continues that s.73 is an existing provision of national law concerning access to cable of broadcasting services for it provides (and provided at the date of the directive) a defence to an allegation of infringement of copyright in a wireless broadcast or any work included in such a broadcast arising from the reception of the broadcast and its immediate retransmission by cable, subject to the other requirements of the section. Section 73 is therefore one of those provisions to which Article 9 refers, and Article 9 says expressly that Directive 2001/29 is without prejudice to such provisions. Article 9 therefore authorises the continued retention by the United Kingdom of s.73 with the scope it had as at the date of the directive.

Miss May urges an interpretation of Article 9 which lies between those of Mr Mellor and Mr Howe. As I have indicated, she submits that the term “cable” has the specific and limited technical meaning for which Mr Mellor contends. But she also submits that the phrase “access to cable of broadcasting services” encompasses both the “reception area” and “must carry” exceptions embodied in s.73. Indeed she contends that s.73 falls squarely within it.

I have come to the conclusion that the meaning of Article 9 is not clear and that, for reasons which I develop later in this judgment, it is appropriate to seek a preliminary ruling from the Court of Justice as to its proper scope. But in case it should be of assistance to the Court, I offer my own provisional view.

It is convenient to deal first with the “reception area” point. I recognise the force of the argument which Mr Mellor makes, namely that there is a difference between the “must carry” and “reception area” exceptions and that the former may be said to relate to the right of the broadcasters to access cable capacity and so does fall within the scope of Article 9, whereas the latter involves access by cable system providers to public sector broadcasts and so does not fall within the scope of this provision. But I consider there are powerful reasons for saying that Mr Mellor’s argument pays insufficient regard to the nature of the “reception area” exception and involves an unduly restrictive approach to the words of Article 9. The “reception area” exception was introduced in the manner I have described and is strictly circumscribed. It relates only to the distribution by immediate retransmission of the broadcasts from the United Kingdom of public service broadcasters. Further, the broadcasts must have been made for reception in the area in which they are retransmitted. Moreover, this exception was introduced to facilitate retransmission of public service broadcasts in areas where reception might be poor or where for some other reason aerials could not be used. It is of course true to say that retransmissions falling within this exception are not made by cable operators under compulsion but it may be said that the exception is nonetheless one which concerns the access of broadcasting services to cable for it facilitates and regulates the immediate retransmission of these public service broadcasts by cable in areas in which the broadcasts were made for reception. I would therefore lean in favour of accepting the submissions of Mr Howe and Miss May on this issue.

The second point concerns the meaning of the term “cable” in the phrase “access to cable of broadcasting services” in Article 9. I acknowledge the force of the arguments developed by Mr Mellor and Miss May in support of the proposition that the term “cable” has a settled and autonomous meaning throughout the European Union acquis. As I have mentioned, they point, by way of example, to Directive 92/100/EEC of 19 November 1992, Directive 93/83 (to which I have referred) and Directive 93/98/EEC of 29 October 1993 and contend that each of these directives uses the term “cable” to identify a particular means for conveying transmissions which is encompassed by the term “wire” but is of more limited scope. Similarly, they continue, the European Union acquis draws a distinction between broadcast transmission services, including cable retransmissions, on the one hand and Information Society services, including transmissions on the internet, on the other. Turning to Directive 2001/29, they argue that the term “cable” is again used in a technologically specific way and further, that, by using the phrase “access to cable of broadcasting services” in Article 9, the European Union legislature cannot have intended to provide an exception for national provisions concerning internet retransmissions.

Against this, however, I can see considerable force in Mr Howe’s submission that Article 9 is an unusual provision for, as its title makes clear, it is concerned with the continued application of other legal provisions, including, as all parties before us accept, existing provisions of national law. As Mr Howe points out, it is therefore to be contrasted with Article 5 which is concerned with general exceptions and limitations to the rights provided for in Articles 2 and 3. Moreover and so far as relevant to this appeal, it allows Member States to retain such existing provisions which concern access to cable of broadcasting services. As I have said, I lean in favour of the view that this phrase encompasses both “must carry” and “reception area” exceptions of the kind described in s.73. That being so, it is my provisional view that it is unlikely that the European Union legislature intended by the use of the term “cable” to exclude from the scope of Article 9 provisions concerning retransmissions falling within the scope of these exceptions but which are made over the internet. I would therefore favour the conclusion that Mr Howe is correct in submitting that Article 9 authorised the continued retention by the United Kingdom of s.73 with the scope it had as at the date of the directive.

The importance of these questions to the outcome of this appeal is plain. If Article 9 has the scope for which Mr Howe contends, there can be no incompatibility between Directive 2001/29 and s.73 material to this appeal; nor can the Marleasing principle of conforming interpretation require this court to construe s.73 as being limited to programmes and services provided on dedicated cable networks operated by conventional cable programme providers or in any other way so as to exclude the services provided by TVC in issue here.

On this same assumption, I think it must follow that the 2003 Regulations did not materially cut down the scope of s.73 so as to exclude activities that previously fell within it. Of course, in light of the wider scope of the term “broadcast”, an amendment was needed to make it clear that it only applied to the retransmission by cable of wireless broadcasts for otherwise its scope would have been broadened. But that aside, there was no material change. Nor is there any suggestion in any published document that the government had any intention to make such a change. To the contrary, both the consultation paper on the implementation of the directive published by the Copyright Directorate of the Patent Office on 7 August 2002 and the published analysis of the responses to that consultation paper suggest that it was the government’s intention to retain existing exceptions to the fullest possible extent (see also the decision of this court in Football Association Premier League Ltd v QC Leisure (No.3) [2012] EWCA Civ 1708, [2013] FSR 20 at paragraph [52]). I think it must also follow that the judge was right to conclude that, to the extent that TVC had streamed ITV, Channel 4 or Channel 5 to members of the public by cable (which included transmission via the internet but did not include transmission by mobile devices via any mobile telephone network) and to users situated in the region to which the original broadcasts were made, it had not infringed the broadcasters’ copyright by reason of the defence contained in s.73 of the CDPA.

If, on the other hand, the Court of Justice were to conclude that the scope of Article 9 is rather narrower, as Mr Mellor or Miss May contend, it would then be necessary to consider whether s.73 must be interpreted as being limited to the retransmission of broadcasts on traditional cable systems operated by conventional cable programme providers or so as to exclude its “reception area” aspect, as the case may be.

In my judgment this is an issue which cannot be decided at this stage and must be left until the scope of Article 9 is clarified. I recognise that, in interpreting and applying national law intended to give effect to a directive, the courts of this country are required to do so, as far as possible, in light of the wording and purpose of the directive and in order to pursue its objectives. I am also conscious that, as Arden LJ explained in HMRC v IDT Card Services (Ireland) Limited [2006] EWCA Civ 29, [2006] STC 1252, this approach to interpretation goes further than is allowed under purely domestic law and permits the adoption of an interpretation which is not the natural one. Nevertheless, as Arden LJ emphasised in IDT at paragraph [82], the process remains one of interpretation and the obligation imposed by the Court of Justice is only to interpret national law in conformity with a directive so far as possible. Ultimately the court cannot adopt a meaning which conflicts with a fundamental feature of the legislation or which “goes against its grain”. It must respect the boundary between interpretation (which is permissible) and amendment (which is not). Having regard to these principles, I have no doubt that, depending upon the answer and guidance given by the Court of Justice to the questions I would refer, there is a real possibility that I would conclude that s.73 must now be interpreted in a more limited way. Indeed and by way of illustration, if the Court of Justice were to conclude that the term “cable” in the phrase “access to cable of broadcasting services” in Article 9 has the meaning for which Mr Mellor and Miss May contend then I consider it would be necessary to give s.73 an updating interpretation and to give the term “cable” within that provision a meaning consistent with its meaning in Article 9.

Under Article 267 of the Treaty on the Functioning of the European Union this court may submit a request to the Court of Justice for a preliminary ruling on a question of European Union law if it considers it is necessary to do so in order to resolve the dispute brought before it.

The present case raises a difficult question as to the scope of Article 9 of Directive 2001/29 and whether it permits the retention by a Member State of a provision such as s.73 of the CDPA which, in the particular circumstances set out in that section, affords a defence both to an allegation of infringement of copyright in a broadcast and of the copyright in any work included in the broadcast arising from the streaming of public service broadcasts to members of the public where that streaming takes place by wire (a) via the internet (but not including transmission by mobile devices via any mobile telephone network) and/or (b) to users situated in the original broadcast area. Further and for the reasons I have given I am satisfied that a ruling on this question is necessary for this court to give judgment.

It only remains to consider whether this court should exercise its discretion to request a preliminary ruling from the Court of Justice. I am conscious that none of the parties before us has invited us to take this course. However, as is well established, the court may do so of its own initiative. I have come to the conclusion that it is appropriate to do so. The relevant facts are clear. The issues raised by the question I would refer are critical to our final decision and I do not believe that this court can resolve them with complete confidence without guidance from the Court of Justice. Moreover, they are important issues in relation to which a uniform approach across the European Union is essential. It is regrettable that there needs to be a second reference to the Court of Justice in this case but that is a consequence of the fact that the issues on which this appeal turns were never fully developed before the judge.

I should add that after the hearing and this court having formed the provisional view that it was appropriate to make a further reference, we invited the parties to file further written submissions on this issue. The parties duly did so, but the submissions we received did not alter the provisional view to which we had come. We have also been informed that the European Commission has sent a letter of formal notice to the United Kingdom pursuant to Article 258 of the Treaty on the Functioning of the European Union in relation to s.73, but we have not been provided with a copy of this notice and no party has suggested that it should affect our decision. In all these circumstances and for all of the reasons I have given, I would make a reference and invite the parties to make submissions as to the precise wording of the questions I have identified.

The judge decided that the defence afforded by s.73 applied only if the whole of the retransmission took place by cable. He reasoned that if that were not so then it would apply to a case in which initial retransmission by cable to an antenna was followed by widespread broadcast.

Mr Howe submits that that the judge fell into error and he advances two alternative reasons for reaching a different conclusion. First, he submits that s.73 should be interpreted as shielding the act of retransmission from infringement to the extent that the retransmission takes place by cable. Hence, to take the example postulated by the judge, the defence would be available in respect of the retransmission by cable to the antenna, but not in respect of the widespread broadcast from the antenna. This, says Mr Howe, would amount to a new restricted act. So also, he continues, s.73 applies to the service provided by TVC so far as it involves the distribution of signals over the internet to individual mobile base stations. The transmission of any signal from a base station to an individual mobile telephone does not amount to an act of broadcasting or any other restricted act. Further, the signal pathway from the base station to an individual mobile telephone is a private pathway which is hired by the user from the mobile telephone company and it is not something for which TVC are responsible.

Second, Mr Howe contends that, even if, contrary to his first argument, s.73 does not apply to the cabled part of the retransmission where the signal does not reach its destination by cable, the mobile telephone case is still to be regarded as a case where the retransmission, when taken as a whole, has taken place substantially by cable, and that is enough to attract the protection of the section.

I do not find either of Mr Howe’s arguments persuasive. As for the first, the judge has held that TVC have infringed the broadcasters’ film and broadcast copyrights by communicating those works to the public, that is to say the users of mobile telephones, by electronic transmission. Thus, as Mr Mellor says, the judge has found that the transmissions in issue start at TVC’s servers and end with the individual mobile telephone users, and that TVC are responsible for them. It is not permissible to divide those transmissions into parts and say that some parts constitute restricted acts and others do not, or that TVC are responsible for some parts but not others, or that some (if not all) parts are entitled to the defence afforded by s.73.

Mr Howe’s second argument is, in my judgment, equally unattractive. There is no foundation in s.73 for the contention that it is enough that the retransmission takes place substantially by cable. To the contrary, s.73(13), recited at paragraph 22 above, makes it clear that, microwave links apart, the section only applies where the retransmissions do not involve wireless telegraphy.

For the reasons I have given I would:

I agree that TVC’s appeal should be dismissed, for the reasons given by Kitchin LJ. I also agree that the broadcasters’ appeal should be stayed pending a reference to the Court of Justice. As to that, in the light of Kitchin LJ’s very full exposition, I can summarise my reasons very briefly.

First, for the reasons given by Kitchin LJ at paras. 24-42 of his judgment, I believe that until the coming into force of the 2003 Regulations section 73 of the 1988 Act applied to services of the kind supplied by TVC – that is, that the word “cable” in the original version of the Act, and the phrases “cable service” and “cable programme service” in its subsequently amended form, extend to transmission over any kind of wire, including the wires that afford access to the internet. Further, the amendments made to section 73 by the Regulations do not evince any intention to change the meaning of “cable service” and “cable programme service”: they appear to be no more than the amendments necessary to reflect the changes to sections 6 and 7 which he describes.

It follows that in my view the broadcasters’ case depends on their establishing (a) that that “domestic” meaning of section 73 is inconsistent with the requirements of Directive 2001/29 (I eschew the inelegant, indeed positively Newspeak, shorthand “Infosoc Directive”); and (b) that it is possible – and therefore required – to give it a different construction which conforms with those requirements, in accordance with the Marleasing principle.

As to (a), it is established by the decision of the Court in the earlier reference (C-607/11) that TVC’s simultaneous “same area” re-transmissions constitute “communications” within the meaning of article 3.1. No separate authorisation is sought by TVC for those communications. It follows that they will only be lawful if they fall within one of the “exceptions and limitations” provided for under article 5 or if article 9 preserves the effect of the domestic defence afforded by section 73. No reliance is placed by TVC on article 5, so the issue of the lawfulness of its re-transmission of Berne works turns entirely on the effect of article 9 – more specifically, on whether section 73 (3) constitutes a “provision concerning … access to cable of broadcasting services”. My provisional view, contrary to that of Kitchin LJ, is that as a matter of language that phrase naturally connotes only provisions which require cable operators to carry broadcast services, i.e. so-called “must carry” legislation, and thus that it has no application to voluntary re-transmission such as TVC supplies; and I believe that that limited meaning is more consonant with the policy underlying the Directive as explained in the earlier decision of the Court. But I recognise that the answer is not clear. There is a further point. If the relevant words in article 9 do indeed preserve the effect of national legislation which legitimises same-area simultaneous re-transmission by “cable”, the question arises whether “cable” includes any form of wire, i.e. not only “traditional cable networks”, that may carry internet services. My provisional view is that it would do so, but again the answer does not seem to me to be clear.

As to (b), a definitive view is perhaps not required at this stage; but a reference would be pointless if it were clear that, whatever the position as a matter of EU law, the domestic legislation could not be interpreted conformably with it. As to that, my provisional view is that whether such an interpretation is possible would depend on the basis on which section 73 (3) were held to be inconsistent with the Directive. If the position were that legislation permitting simultaneous same-area retransmission did not fall within article 9 at all, I do not think that it would be possible simply to strike down section 73 (3), which represents a clear legislative choice on a primary policy issue. But if article 9 does legitimise such re-transmission but only in the case of “traditional cable” I believe that it would be possible to read the language of section 73 conformably, even though that meant that the same words had a different meaning before and after the coming into force of the 2003 Act.

In these circumstances the correct meaning of article 9 of the Directive is central to the outcome of the broadcasters’ appeal. I believe that it is necessary to refer that question to the Court of Justice in order to resolve the appeal and that such a reference should be made, for the reasons given by Kitchin LJ at para. 89 of his judgment.

I agree with the judgments of Kitchin and Underhill LJJ save on the points on which they differ and save as appears below. I am indebted to Kitchin LJ for setting out the issues so comprehensively, and I adopt his definitions. I can now turn to the principal point which divides the court, namely the effect of the “same area defence” to copyright infringement in section 73(2) (b) of the CDPA (as amended).

In my judgment, to resolve this question, it is necessary to determine the meaning of the expression “cable” in section 73. As amplified below, I consider (1) that the expectation domestically must be that meaning is the same as the meaning of “cable” in Directive 2001/29, and (2) that the latter meaning is a question of EU law and is not acte clair. In those circumstances, I agree with Kitchin and Underhill LJJ that this Court should refer the questions which arise in this case on the interpretation of Directive 2001/29 to the Court of Justice for a preliminary ruling.

It is clear from the 2003 Regulations that Parliament intended to comply with its treaty obligations to implement Directive 2001/29. The 2003 Regulations were made pursuant to section 2(2) of the European Communities Act 1972. The decision to implement Directive 2001/29 by the 2003 Regulations led to important changes to the CDPA. In particular there were numerous amendments affecting the use of the word “cable” to render the provisions of the CDPA relating to “broadcasting”, to borrow Mr. Howe’s term, “technology-neutral”, by which I mean inclusive of cable transmission. This new approach to “broadcasting” was consistent with the approach to “broadcasting” in Article 1(2)(c) of Directive 2001/29.

It seems that the Secretary of State, when promoting the 2003 Regulations, took the view that section 73 of CDPA (as amended) was compatible with Directive 2001/29 because it fell within Article 9. That leads to some interesting questions about “conforming interpretation” (the principles of interpretation which the court applies to make domestic legislation conform to EU legislation, often called the Marleasing principle). Suppose that in Directive 2001/29 the expression “cable” had a narrower meaning than that which applied in section 73 prior to 2003. Could the court apply the narrower meaning after the 2003 Regulations came into force even though the Regulations did not indicate that the word “cable” in section 73 was thenceforth to have a different meaning? My provisional view is that, following the implementation of Directive 2001/29 into our domestic law, the expression “cable” in section 73 would have to bear a narrower meaning than before if that is what the Directive required, and that there would be no intrinsic difficulty about this. Since there is no definition of “cable” for the purposes of section 73, the word can bear an ambulatory, or movable, meaning. So there would be no difficulty in the court interpreting this phrase now in accordance with Directive 2001/29. Indeed the absence of a definition suggests that Parliament intended that the word “cable” should bear whatever meaning it had in EU law.

The word “cable” also appears in section 144A of CDPA. It is common ground that “cable” in section 144A may have a wider meaning than traditional cable. But this does not mean that the same meaning must apply in section 73. “Cable” in section 144A may have a wider meaning than traditional cable. The context and origin of section 73 are different from those of section 144A. Section 73 seeks now to make use of the member state option in Article 9 of Directive 2001/29. By contrast section 144A is derived from a different directive, namely Directive 93/83.

The court has on occasion departed from the principle of statutory interpretation that expressions used in legislation bear the same meaning throughout that legislation where this is necessary to give effect to EU law: see Gingi v Secretary of State for Work and Pensions [2001] EWCA 1685, [2002] 1 CMLR 587. In interpreting section 73, the court would have to keep in mind that, in a harmonising directive, such as Directive 2001/29, a member state option may have to be narrowly construed: see, for example, Case C- 435/12 ACI Adam BV and others v Stichting de Thuiskopie and another at [22].

Is the meaning of cable in Directive 2001/29 restricted to traditional cable? Both Mr Mellor and Miss May have presented detailed and persuasive arguments that, in the EU acquis (or body of law), “cable” has an accepted meaning of conventional cable, that is, cable used for the traditional television relay and diffusion services. Miss May relies, for example, on Article 6(2) of Directive 92/100. This treats transmission by cable as a subset of transmission by wire. Mr Mellor and Miss May contend that there is nothing in Directive 2001/29, or any of the four Directives which precede it, to indicate any deviation from traditional cable. If this argument is correct, the word “cable” does not include the fibre optic cables used for transmitting messages by internet. Provisionally it seems to me that the questions referred to the Court of Justice should identify the meaning is said to be found in the EU acquis (including Directive 93/83, referred to above).

Is Section 73(13) inconsistent with this meaning if cable in Directive 2001/29 has a narrower meaning? Section 73(13) provides that transmission by cable includes microwave energy between terrestrial fixed points. That question too raises some interesting questions of conforming interpretation. My provisional view is that that provision is not necessarily inconsistent with the narrower meaning of cable if EU law accepts that cable in that sense may need to be supplemented by microwave energy to (for example) cross rivers and estuaries. There could be an element of ambiguity in references in EU legislation to the inclusion within “cable” of microwave links. That is potentially the subject of another question for the reference.

The argument, based on the EU acquis, that “cable” in Directive 2001/29 is limited to conventional cable is arguably supported by the scheme and objects of Directive 2001/29. The Directive may fall to be analysed as follows. Article 1 is largely introductory, but Article 1 importantly provides that the Directive does not affect Community copyright and related rights applicable to broadcasting by cable retransmission (Article 1(2)(c)). This may militate in favour of an interpretation of Article 9 that does not permit a provision which would significantly destroy the broadcasters’ pre-existing copyright. This may be confirmed by Article 8(1) of Directive 93/83/EEC, which provides that:

Articles 2 to 5 of Directive 2001/29 deal (so far as relevant) with the grant of copyright to broadcasters in fixations of their broadcasts. Thus Article 2 confers a reproduction right, Article 3 confers a right to communicate to the public, Article 4 confers a distribution right and Article 5 sets out exceptions. Consistently with the objectives of the Directive, these provisions are widely cast. Importantly, Article 2 again treats cable as a subset of “wire” (see paragraph 62 above).

Articles 1 to 5 are the operative provisions of Directive 2001/29, and the remaining provisions give effect to those provisions. Articles 6 to 8 of Directive 2001/29 deal with a different subject-matter. This includes obligations as to technological measures (Article 6) and obligations concerning rights-management information (Article 7). Article 8 deals with the availability of sanctions and remedies under national law.

Article 9 preserves a “job lot” of miscellaneous measures which (as far as relevant) might be implemented by member state legislation. As Kitchin LJ explains, Article 9 gives effect to recital (60) to the Directive. This provides:

(60)

The protection provided under this Directive should be without prejudice to national or Community legal provisions in other areas, such as industrial property, data protection, conditional access, access to public documents, and the rule of media exploitation chronology, which may affect the protection of copyright or related rights.

If the EU acquis means that “cable” in Directive 2001/29 bears the meaning of traditional cable, it would seem provisionally to follow that the expression “access to cable” is not primarily dealing with defences to copyright infringement but with the use of cable by broadcasters that national law may authorise. The full expression makes no specific mention of copyright at all. Recital (60) likewise makes no mention of copyright as such even though it refers to other intellectual property and access to public documents. This would arguably reinforce the conclusion that its primary aim (in the context of cable) is to deal with access to infrastructure in the member states.

The decision of the Court of Justice in Case C-607/11 concerns use of the internet. It established that, in the context of the internet, retransmission was a separate communication giving rise to separate remuneration for the owner of the copyright. This is consistent with the CDPA’s new concept of broadcasting, as explained in summary above. But it does not follow that exceptions to the rights in Articles 2 and 3 cannot arise by implication from other provisions of Directive 2001/29. This may be another question for the reference.

We have not been shown any other EU legislation which deals with access to infrastructure. If it is right to interpret “access to cable of broadcasting services” as dealing with access to infrastructure, the subject-matter would be apt for member state legislatures and not the EU legislature. Member states might have different levels of capability and thus require different legislation about use of cable networks. In the case of the same area exception in section 73, the cable owner is not compelled to permit use and he can negotiate a fair price. As Miss May points out, this would encourage investment in cable so that both the public interest in investment in infrastructure and the interests of cable owners are capable of being furthered.

Some weight might be given to the fact that Article 9 is framed as a provision whose purpose is simply to avoid any invalidation of any national measures on a whole range of matters and that it does not in terms create an exception to Article 3 rights.

It may be that Article 9 is limited to national measures in force at the date on which Directive 2001/29 was agreed or on its last date for implementation. There are no words in the body of Article 9 or Recital (60) which state such a limitation, and the cross-heading to Article 9 (Continued application of other legal provisions) is not unambiguous. This might be another question for the reference. A limitation to provisions which exist at the date the Directive is adopted or implemented may prove highly inconvenient in practice to the achievement of an information society if Article 9 is concerned with access to infrastructure.

It is quite possible that the Court of Justice would give Article 9 a practical construction. It can be urged on it that the national courts could monitor any abuse of member state rights through applying the principle of proportionality. Thus any national legislation that utilised the member state option in Article 9 may have to be proportionate in accordance with the general principle of EU law and establish a fair balance between the rights of copyright owners, cable owners and the public interest. This subject may also be relevant for the reference.

For the reasons given by Kitchin LJ, the “must carry” provisions appear implicitly to carry the right to retransmit copyright material so that section 73 creates a good defence in their case, though we are not directly concerned with that part of section 73.

If on its true interpretation “access to cable” in Directive 2001/29 means access to the physical infrastructure, provisionally it would seem to follow that it does not include internet transmission using fibre optic wires.

In summary I agree that we should refer to the Court of Justice the questions of EU law which have to be resolved so that the court can apply a conforming interpretation of section 73 (if it is possible so to do). I would also invite the assistance of counsel in formulating the questions to be referred though the final formulation of the questions is a matter for the court.