Out-Law News | 15 Sep 2014 | 2:27 pm | 1 min. read
In a ruling that clarifies the scope of the EU's E-Commerce Directive, the CJEU clarified that online news publishers that enable free access to their content and are instead backed by money from advertising cannot claim to be acting as intermediaries in the publishing of content on their sites on the basis of that payment model.
The judgment means that all online news publishers can be held liable for unlawful material on their websites, under certain circumstances.
"Since a newspaper publishing company which posts an online version of a newspaper on its website has, in principle, knowledge about the information which it posts and exercises control over that information, it cannot be considered to be an ‘intermediary service provider’ within the meaning of [the E-Commerce Directive], whether or not access to that website is free of charge," the CJEU ruled.
The case handled by the CJEU related to a dispute in Cyprus between a man, Sotiris Papasavvas, and a newspaper company, its editor-in-chief and one of its journalists. Papasavvas has claimed that material published online by the paper was defamatory of him and is seeking an injunction in Cyprus for the material to be removed.
However, before ruling on the case, the Cyprus court asked the CJEU to confirm whether the extent to which online newspapers could be held liable for illegal information on their websites was dependent on whether the material was available for free or subject to subscription and whether the newspapers generated revenues from advertising.
The E-Commerce Directive protects online service providers from liability for material that they neither create nor monitor but simply store or pass on to users of their service in some circumstances. Under the rules, service providers acting as intermediaries, such as internet service providers (ISPs), are generally not responsible for the unlawful activity of publishers or internet users. EU countries are prohibited, under the Directive, from setting rules that force service providers to pro-actively monitor for illegal activity on their service.
Under the E-Commerce Directive, online service providers are generally not liable for unlawful information they transmit, temporary store or host on behalf of publishers.
The exemption from liability for caching or hosting the information ends, however, if the service providers have 'actual knowledge' that the information they are storing or hosting is illegal or an awareness of facts or circumstances that suggest illegality and they fail to act "expeditiously to remove or to disable access to the information".