Polish court rules that producers and importers of multifunctional devices (e.g. mobile phones or tablets) must pay copyright levy

Do producers and importers of multifunctional devices (e.g. mobile phones or tablets) have to pay a copyright levy for their sale in Poland? According to the recent ruling and published justification of District Court in Warsaw of 31 May 2023, the answer is yes.

The verdict ended ongoing litigation between a business responsible for the sale of electronic devices and carriers in Poland and a collective management organisation operating under the supervision of the Minister of Culture and National Heritage (CMO). The Court approved the request of the CMO for the payment of the copyright levies also for the sale of multifunctional devices (e.g. mobile phones or tablets) in Poland.

Under the Polish Act on Copyright and Related Rights ("Copyright Law"), manufacturers and importers of personal copying devices, the most prominent being tape recorders, VCRs and other similar devices must pay copyright levies to collective management organisations for their sale in Poland.

Although the Copyright Law states levies may also apply to “other similar devices”, it also provides that their categories and fees will be decided in the executive regulation: Regulation of the Minister of Culture determining the categories of devices and media used for the recording of works and imposing the levy on such devices and media when sold by manufacturers and importers ("the Regulation").

The list provided in the Regulation includes a variety of devices and carriers, including those considered obsolete and unpopular nowadays such as audio tapes and tapes recorders, and does not include those that currently play a key role all over the world, such as smartphones or tablets. Hence, one of the questions the court had to answer was whether the list provided in the Regulation is exhaustive. In other words, are the manufacturers and importers obliged to pay a levy for the sale of devices, such as smartphones or tablets, although they are not explicitly listed in the Regulation?

In the Court’s view, the copyright levies should be applied not only to devices expressly listed in the Regulation, but also to all devices capable of making copies for personal use. According to the Court's reasoning, the purpose of the Regulation is to specify the categories of devices and media referred to in the Copyright Law, and the ultimate calculation of the relevant fee and its qualification to a specific category should be made by the manufacturer or importer.

Such a conclusion may raise concerns among manufacturers and importers of electronic devices, specifically around the clarity, certainty and predictability of the copyright levy system in Poland.

According to analysts, the current system and regulations in Poland governing the payment of copyright levies require updating not only concerning the rapid development of the technology but also regarding discrepancies between provisions of the Copyright Law, and EU legislation and case-law of the Court of Justice of the European Union (e.g. the CJEU ruled that levies by importers or manufacturers should be refundable if the sales in question were not related to end user’s private and personal use).

The 31 May judgment of the Polish Court is not final and is likely to be appealed. Therefore, manufacturers and importers should follow this matter carefully since it may impact their obligations and affect their pricing policies.

For more information on this ruling and copyright law in Poland, contact your CMS client partner or these CMS experts.