April 9, 2021
SIA CV-Online Latvia operates the website CV.lv, which comprises a database, developed and regularly updated by CV-Online, containing notices of jobs published by employers.
The website also uses microdata meta tags, which are not visible when the website is opened, but which make it easier for internet search engines to identify the contents of each page in order to index them in its search results. For each job ad in the database, the meta tags contain key phrases, such as “name of job”, “name of the undertaking”, “place of employment” and “date of publication of the notice”.
SIA Melons, another Latvian company, operates the website KurDarbs.lv, which is a search engine specialising in job ads. The search engine makes it possible to search on several websites containing job ads, according to various criteria such as type of job and place of employment. The website then provides users with hyperlinks to the websites on which the ads were initially published, including CV-Online’s website. CV-Online’s meta tags are also displayed in the list of results provided by Melons’ website.
CV-Online issued proceedings against Melons in the Latvian courts alleging infringement of its database rights under the Database Directive (96/9/EC). CV-Online said that Melons had extracted and reused a substantial part of the contents of its database on CV.lv. At first instance, the court found that there had been infringement on the ground that there had been reutilisation of the database.
Melons appealed, submitting that its website did not provide online transmission, i.e. that it did not operate in real time. It also claimed that a distinction should be drawn between the website CV.lv and the database that it contained. It said that it was the meta tags used by CV-Online that allowed the KurDarbs.lv search engine to collate the job ads information in its results page and the meta tags were not part of the database.
The Latvian court referred two questions to the CJEU in relation to the interpretation of “reutilisation” under Article 7(2)(b) and “extraction” under article 7(2)(a).
Advocate General Szpunar noted that in order for there to be any infringement of database rights, database rights had to exist in the first place. In respect of CV-Online’s database, the independent materials that formed its contents were job ads. Each job ad constituted a unit of information that had autonomous informative value and was separable from the other job ads in the database. Further, each job ad in CV-Online’s database was individually accessible by means of the search form. The job ads were provided to CV-Online by the employers and CV-Online verified and presented them. While it was for the referring court to ascertain whether CV-Online had made a substantial investment in creating its database, at first sight there was no reason to doubt that.
The Latvian court asked whether the fact that the user was sent hyperlinks to a website comprising a database relating to job ads came within the definition of “reutilisation” in Article 7(2)(b).
Given that the question referred to individual materials within the database, i.e. the job ads, rather than the database itself, the AG said that the real problem raised by the question was not the hyperlinks, but the way in which the job ads to which those links referred were selected by Melons’ search engine.
The AG noted that Melons’ search engine reproduced and indexed websites containing job ads, such as CV.lv, and then allowed searches to be made within the contents indexed according to certain criteria, such as the type of job and the place of work. Melons’ search engine therefore specialised in searches within databases accessible on the internet, i.e. it was a “content aggregator”.
The Latvian court also asked whether the information originating from the meta tags of a website containing a database that the search engine displayed on the internet supplied by a third party came within the definition of “extraction” in Article 7(2)(a).
The AG said that, again, this question concerned the functioning of Melons’ search engine.
The AG proposed analysing both questions together, taking them to mean that they related to whether under Article 7(1) and (2) the maker of a database that was freely accessible on the internet was entitled to prevent the use of that database by an internet search engine that specialised in searching the contents of databases (i.e. a content aggregator).
The AG referred to Case C-202/12 Innoweb BV v Wegener ICT Media BV EU:C:2013:850, which concerned ads for the sale of secondhand cars. The CJEU ruled that, in certain circumstances, the provision of a “dedicated meta search engine” can constitute “re-utilisation” for the purposes of Article 7. The CJEU considered that, by making it possible to search all of the data in a protected database, a meta search engine provided its users with access to the entire contents of that database by a means other than that intended by its maker. The operator of a meta search engine therefore intentionally reutilised a substantial part of the contents, if not the entire contents, of the online database.
The AG noted that Melons’ search engine worked differently to a meta search engine. It did not use the search forms of the websites on which it allowed searches to be carried out and it did not translate its users’ requests into criteria used by those forms in real time. Instead, it regularly indexed those sites and kept a copy on its own servers. By using its own search form, it enabled users to search, using certain criteria, within the data that it had indexed. In doing so, Melons’ search engine operated in a similar way to generalist internet search engines, such as Google, but in relation to job advertising websites only. It therefore intentionally used certain websites, including CV-Online’s website.
Despite not being a “meta search engine”, however, Melons’ search engine still had the same capacity to explore the entire contents of a database within a website. By then providing the user with access to the job ads within the database, the AG said that Melons’ search engine “reutilised” those contents in the Innoweb sense. Further, by indexing and copying the contents of the website to its own server, Melons’ search engine “extracted” the contents of the databases within those websites. The provision of the hyperlinks to the ads on CV-Online’s website and the reproduction of the information in the meta tags on that site were merely external manifestations of secondary importance of that extraction and reutilisation.
The AG concluded therefore that a search engine that copied and indexed the whole or a substantial part of a database that was freely accessible on the internet and then allowed its users to carry out searches within those databases according to certain criteria amounted to extraction and reutilisation of those contents within the meaning of Article 7(2).
However, in the AG’s view, the right to prevent such extraction and reutilisation should be subject to certain conditions.
While the sui generis right provided for in Article 7 aims to protect database makers against the creation of parasitical competing products, the AG said that it should not at the same time have the effect of preventing the creation of innovative products that have added value, such as content aggregators have done. The AG said that, not only do content aggregators allow information on the internet to be better structured and searched more efficiently, but they also contribute to the smooth functioning of competition. They therefore have a not insignificant role in the functioning of the internet and the digital economy as a whole.
At the same time, the AG said, by grafting their services on to those of content creators, content aggregators derive a profit from the economic efforts of those creators. It was therefore necessary to strike a fair balance between the interests of those operators and the interests of content aggregators and their users.
In the AG’s view, the EU legislature’s intention was to base that balance on the concept of the investment made by the database maker. Making the risk of an adverse effect on the investment in the database (e.g. there being a threat to the revenue from its exploitation) a condition of the grant of the sui generis right would, in the AG’s opinion, achieve this balance. After all, the primary objective of Article 7 is to limit protection of the sui generis right solely to databases the creation and functioning of which require substantial investment. Such limitation also had the function of protecting competition.
The national courts should therefore verify not only whether the extraction or reutilisation of the whole or a substantial part of the contents of a database has taken place and whether there has been a substantial investment in either the obtaining, verification or presentation of those contents, but also whether the extraction or reutilisation in question poses a risk to the possibility of recouping that investment. Only where that is found to be the case should the makers of databases be entitled to prevent the extraction or reutilisation of the contents of their databases. In this case, it was a matter for the Latvian court to decide.
The AG also referred to Article 13 of the Directive, which provides that the provisions of the Directive are “without prejudice to provisions concerning in particular… laws on restrictive practices and unfair competition…”. The AG said that the protection granted by the sui generis right should not lead to abuse of a dominant position. The drafters of the Directive were aware of this risk, which is why they included Article 13.
The AG said that it was for the Latvian court to ascertain whether CV-Online’s conduct constituted abuse of a dominant position. If it were to find that it did, then the court might, if appropriate, decide to deny CV Online the benefit of the sui generis right.
The AG therefore said that Article 7 should be interpreted as meaning that the maker of a database has the right to prevent the extraction or the reutilisation of the whole or a substantial part of the contents of that database only on condition that such extraction or reutilisation adversely affects its investment in obtaining, verifying or presenting those contents, that is to say, that it constitutes a risk for the possibility of recouping that investment by the normal exploitation of the database in question. Further, the prevention of such extraction or reutilisation cannot constitute an abuse of the dominant position of the maker of the database on the market concerned or on a secondary market. It was for the national courts to ascertain whether those conditions were satisfied. (Case C-762/19 SIA CV-Online Latvia v SIA Melons EU:C:2021:22 (Opinion of Advocate General) (14 January 2021) — to read the Opinion in full, click here).