The Constitutional Court recognized the list of empty data carriers and reproduction equipment established by the Cabinet of Ministers, for which carrier levy should be paid, as anticonstitutional
On 2 May 2012, the Constitutional Court adopted a judgment in the case No. 2011-17-03 “On Compliance of Section 3 and 4 of 10 May 2005 Cabinet of Minister Regulation No. 312 “Regulations regarding the Amount of the Blank Tape Levy and the Levy of Equipment Used for Reproduction and the Procedures for the Collection, Repayment, Distribution and Payment Thereof” with Article 64, Article 105 and Article 113 of the Satversme of the Republic of Latvia”.
On duty of the Cabinet of Ministers to assess effectiveness of a normative regulatory framework in time
Contested Norms
Section 3 and 4 of 10 May 2005 Cabinet of Minister Regulation No. 312 “Regulations regarding the Amount of the Blank Tape Levy and the Levy of Equipment Used for Reproduction and the Procedures for the Collection, Repayment, Distribution and Payment Thereof” provide that the blank tape levy shall be paid in a certain amount for audio cassettes, video cassettes mini discs, CD-R, CD-RW, DVD-R, DVD-RW, an audio tape-recorder with audio cassette recording function, a radio with audio cassette recording function, an audio tape-recorder with audio cassette and CD recording function, a radio with audio cassette and CD recording function, a radio with CD recording function, a radio with MD recording function, a CD player with recording function, a MD player with recording function, a MP3 player with an integrated hard disk, a video player with video cassette recording function, a television set with video cassette recording function, a DVD player with recording function, a television set with DVD recording function, a satellite receiver with data recording function, any CD or DVD recorder which can be connected to a computer.
The Facts
The applicants – associations “Latvian Association of Performers and Producers” [„Latvijas Izpildītāju un producentu apvienība”], “Copyright and Communication Consulting Agency/Latvian Authors Association” [„Autortiesību un komunicēšanās konsultāciju aģentūra / Latvijas Autoru apvienība”], “Latvian Association of Cinematographers” [„Latvijas Kinoproducentu asociācija”] and “Latvian Association of Professional Actors” [„Latvijas Profesionālo aktieru apvienība”] hold that Section 34 (1) and Section 54 (5) of the Copyright Law establish restriction to the rights of persons subject to copyright and related rights since they permit reproduction of their works without consent of authors. The above mentioned norms also establish the right of authors to a fair remuneration. However, the right to receive a fair remuneration are restricted by the Contested Norms because they establish collecting of empty data carrier levy only in certain cases.
According to the Applicants, the restriction of the fundamental rights of persons subject to copyright and related rights has been established by law. However, in the Copyright Law, the legislator has established an authorization to the Cabinet of Ministers to apply empty data carrier levy to all empty data carriers and equipment used for reproduction. The Cabinet of Ministers has failed to fulfil this task commissioned by the legislator and thus infringed Article 64 of the Satversme, namely, it has failed to ensure protection of the fundamental rights established in Article 113 of the Satversme.
Court Findings and the Ruling
On meaning of the related rights in the scope of Article 113 of the Satversme
The Constitutional Court indicated that rights of a person subject to copyright and related rights, insofar as it follows from the Contested Norms, cannot be taken apart; therefore there is no need to assess whether Article 113 of the Satversme includes protection of rights of persons subject to related rights because, insofar as it follows from the Contested Norms, restriction of rights of persons subject to copyright and related rights is identical and their rights are protected by applying one and the same legal remedies [12.1].
In its judgment, the Constitutional Court assessed only restriction of rights of persons subject to copyright. Taking into account Section 54 (5) of the Copyright Law, the same arguments shall be applicable to persons subject to related rights [12.1].
On content of material rights of persons subject to copyright
The Constitutional Court indicated that protected material right of persons subject to copy right consist of two elements: exclusive material right that enables an author receiving royalties, and restricted material rights or exception rights when the State restricts the right of the author to deal with his or her work by means of legislation. Respectively, the function of material rights of authors is to guarantee protection of material interests of the owner of rights, namely, to control economic use of a work [12.4].
The Constitutional Court recognized that the duty to protect material rights of persons subject to copyright include the right of authors to gain material benefit from the use of their work; however this right are not absolute as to its nature [12.4].
On authority granted by the legislator to the Cabinet of Ministers
Section 34 (2) of the Copyright Law includes a list of certain empty data carries, and the list is not regarded as exhaustive; however, the Cabinet of Ministers has to take it into account when establishing the procedure for collecting the empty data carrier levy. The legislator has established no particular criteria that the Cabinet of Ministers should apply when deciding on including of certain empty data carriers and equipment into the Contested Norms. Therefore the Court concluded that the legislator has granted the Cabinet of Ministers the right to establish criteria, according to which an exhaustive list of empty data carriers and equipment would be established, as well as commissioned the duty to elaborate such list to the Cabinet of Ministers [13.2].
This primarily is the legislator who is responsible for compliance of an authorization with legal norms of higher legal norms. The legislator has not amended the authorization established in Section 34 (7) of the Copyright Law. Consequently, the Constitutional Court concluded that the legislator had no doubt that the Cabinet of Ministers has adopted the Contested Norms pursuant to the particular authorization [13.3].
The Constitutional Court indicated that inclusion of certain empty data carriers and equipment into the Contested Norms is a legal and political issue to be decided by the Cabinet of Ministers. The Cabinet of Ministers shall have the right and the duty to assess the necessity to include certain empty data carriers and equipment into the Contested Norms; however, it has to guide itself by clearly defined criteria [13.3].
On effectiveness of the normative regulatory framework in time
The Constitutional Court indicated that the Cabinet of Ministers, like the legislator, is committed to periodically consider whether a particular legal regulatory framework is still effective, applied and necessary, and whether it can or can not be improved. Namely, the Cabinet of Ministers is committed to following development of technologies and supplementing the list of empty data carriers and equipment included into the Contested Norms. If the Cabinet of Ministers fails fulfilling its duty, no proper protection of the fundamental rights enshrined in Article 113 of the Satversme is ensured [14.1].
When assessing the fact that the Ministry of Culture had established a work group by involving organizations for collective administration of material rights of authors and organizations representing manufacturers and importers of empty data carriers and equipment; though no compromise on possible amendments of the Contested Norms has been achieved for years, the Constitutional Court indicated that the fact that persons concerned cannot agree on improvement of the Contested Norms does not release the Cabinet of Ministers and the Ministry of Culture from the duty to fulfil their functions. Irrespective of opinions of members of the work group, the Cabinet of Ministers and the Ministry of Culture had to assess the necessity to amend the Contested Norms on their merits. Although hearing of persons concerned is useful and positive constituent part of legislative procedure, the legislator procedure cannot depend on positive or negative attitude of individuals in respect to a draft normative act [14.2].
Since the Cabinet of Ministers and the Ministry of Culture have failed to establish criteria and assess the necessity to include other empty data carriers and equipment into the list established in the Contested Norms, and they have concluded that the Contested Norms shall not be amended at all, the Constitutional Court recognized that the Contested Norms fail to comply with the authorisation included in Section 34 of the Copyright Law and fail to ensure an adequate protection of property right of persons subject to copyright included in Article 113 of the Satversme. Consequently, the Contested Norms fail to comply with Article 113 of the Satversme because the Cabinet of Ministers has failed to assess impact on technology development onto empty data carries and devices subject to the levy [14.3].
On the moment when the Contested Norms would lose effect
The Constitutional Court recognized the Contested Norms as non-compliant with Article 113 of the Satversme based on the fact that The Cabinet of Ministers has failed to fulfil its duty regarding improvement of the content of the Contested Norms. Recognition of the Contested Norms as null and void with retroactive force or as on the date of publishing of the Judgment would cause even more negative consequences to the Applicant if compared to the actual wording of the Contested Norms. In order to assure constitutionality of the Contested Norms, the Cabinet of Ministers shall be committed to assess the list of data carriers and equipment established in the Contested Norms on their merits. This requires time; therefore the Court shall apply the most appropriate solution and recognize the Contested Norms as null and void as from 1 November 2012 [16].
The Constitutional Court recognized Section 3 and 4 of 10 May 2005 Cabinet of Minister Regulation No. 312 “Regulations regarding the Amount of the Blank Tape Levy and the Levy of Equipment Used for Reproduction and the Procedures for the Collection, Repayment, Distribution and Payment Thereof” as non-compliant with Article 113 of the Satversme of the Republic of Latvia and declared it to become null and void as from 1 November 2012 if the Cabinet of Ministers fails to reassess compliance of the list of data carriers and equipment with the authorization included in Section 34 of the Copyright Law based on development of technologies.
The judgment of the Constitutional Court is final and not subject to appeal, it shall come into force on the date of publishing it.
Linked case: 2011-17-03