In the first cluster of questions, the referring court is asking whether the provision of free Wi-Fi constitutes a service falling under Article 12 of the E-Commerce Directive (ECD). The Directive applies to services ‘normally provided for remuneration’ but does not define them nor does it provide any guidelines for their definition. Since ECD excludes liability of intermediaries who are “mere conduits” but not initiators of the transmission, taking a free service out of its scope would also expose the provider to liability.
Article 12″Mere conduit”1. Where an information society service is provided that consists of the transmission in a communication network of information provided by a recipient of the service, or the provision of access to a communication network, Member States shall ensure that the service provider is not liable for the information transmitted, on condition that the provider:(a) does not initiate the transmission;(b) does not select the receiver of the transmission; and(c) does not select or modify the information contained in the transmission.2. The acts of transmission and of provision of access referred to in paragraph 1 include the automatic, intermediate and transient storage of the information transmitted in so far as this takes place for the sole purpose of carrying out the transmission in the communication network, and provided that the information is not stored for any period longer than is reasonably necessary for the transmission.3. This Article shall not affect the possibility for a court or administrative authority, in accordance with Member States’ legal systems, of requiring the service provider to terminate or prevent an infringement.
In dealing with the first group of questions, the AG emphasizes that “only services of an economic nature are covered by the provisions of the FEU Treaty” but also that “the concepts of economic activity and of the provision of services in the context of the internal market must be given a broad interpretation.” The AG’s idea is that provision of Internet access is normally an economic activity even when it is ancillary to the provider’s principal activity. The key is found in paragraph 42:
The very operation of a Wi-Fi network that is accessible to the public, in connection with another economic activity, necessarily takes place in an economic context.
This means that what gives an otherwise non-economic ancillary activity an economic context is the economic nature of the primary activity. Thus a hotel can offer free IT services as a way of promoting its primary activity which is economic in nature. Further to that, it is not necessary for the provider to hold itself out as a provider to the public in order to be given the status necessary under Article 12.
Of some interest are Advocate General’s observations concerning general limitations that any such injunctions might have. In answering the question of whether such limitations are possible, the AG draws upon freedom of expression and information and the freedom to conduct business (Article 11 and 16 of the EU Charter of Fundamental Rights, respectively) which, in his mind, must be balanced against the right to the protection of IP rights (Article 17(2) of the Charter). In particular, it should be taken care:
– that the measures in question comply with Article 3 of Directive 2004/48 and, in particular, are effective, proportionate and dissuasive,
– that, in accordance with Articles 12(3) and 15(1) of Directive 2000/31, they are aimed at bringing a specific infringement to an end or preventing a specific infringement and do not entail a general obligation to monitor,
– that the application of the provisions mentioned, and of other detailed procedures laid down in national law, achieves a fair balance between the relevant fundamental rights, in particular, those protected by Articles 11 and 16 and by Article 17(2) of the Charter.
The AG then discusses whether injunctions phrased in general terms, which leave specific measures to the addressee are allowed. The UPC Telekabel case permits, in principle, such injunctions and the AG refers to this case but he further adds that it is for the national courts to determine not only that proper measures exist but also that they are compatible with the EU requirements listed above.
Finally, the AG discusses hypothetical interim measures proposed by the referring court. These are: 1) termination of the Internet connection, 2) the password-protection of the Internet connection and 3) the examination of all communications passing through that connection. The AG dismisses the first and the third immediately. In his mind, the first is incompatible with the fundamental rights while the third is incompatible with the general prohibition to monitor (Article 15 of the ECD). In regard to the second question (making the network secure), the AG points out the negative sides that such a requirement would bring. Not only would it change the business model of some of them significantly, but it would also increase the burden to store data in compliance with privacy laws.
Looking at the Advocate General’s analysis of the case, one finds little that is truly surprising. The fact that the provision of free Wi-Fi falls under the E-Commerce Directive is not unusual since the term “normally provided for remuneration” never has been restrictively interpreted in Internet-related cases. In Papasavvas, for example, the Court ruled that ECD “covers the provision of online information services for which the service provider is remunerated, not by the recipient, but by income generated by advertisements posted on a website.” Equally unsurprising is the extension of Article 12 ECD to such cases since the provision in question falls squarely within that article.
On the other hand, Advocate General’s ideas concerning the legal limitations to interim measures are of note since he effectively manages to steer clear of some of UPC‘s more problematic aspects. Whereas UPC demands only that the measures should not “unnecessarily” deprive of lawful uses and that they at least have the effect of making it difficult to access illegal services, the AG demands very specifically that they be balanced against fundamental rights in each individual case. This immediately disqualifies connection termination and monitoring but also, and not entirely without surprise, a demand that networks be made secure.