C-262/81

JUDGMENT OF 6. 10. 1982 — CASE 262/81

or to distort competition on the right creates barriers which are arti­ cinematographic market, regard being ficial and unjustifiable in terms of had to the specific characteristics of the needs of the cinematographic that market. industry, or the possibility of charging As regards, in particular, a contract fees which exceed a fair return on whereby the owner of the copyright investment, or an exclusivity the in a film grants an exclusive right to duration of which is disproportionate exhibit that film for a specific period to those requirements, and whether or in the territory of a Member State, it not, from a general point of view, is for national courts to make such such exercise within a given inquiries as are necessary and in geographic area is such as to prevent, particular to establish whether or not restrict or distort competition within the exercise of the exclusive exhibition the common market.

In Case 262 / 81

REFERENCE to the Court under Article 177 of the EEC Treaty by the Cour de Cassation [ Court of Cassation] of the Kingdom of Belgium for a preliminary ruling in the case pending before that court between

1. CODITEL SA, COMPAGNIE GÉNÉRALE POUR LA DIFFUSION DE LA TÉLÉVISION , Brussels,

2. CODITEL BRABANT SA, Brussels,

1. CINÉ-VOG FILMS SA, Schaerbeek ,

2. CHAMBRE SYNDICALE BELGE DE LA CINÉMATOGRAPHIE, a non-profit making association, Saint-Josse-ten-Noode ,

3. LES FILMS LA BOÉTIE SA, Paris ,

CODITEL v CINĖ-VOG FILMS

4. SERGE PINON, syndic of the court-supervised receivership of Les Films La Boétie SA, Paris,

5. CHAMBRE SYNDICALE DES PRODUCTEURS ET EXPORTATEURS DE FILMS FRANÇAIS, Paris,

JUDGMENT

Facts and Issues

I — Facts and written procedure ruling two questions on the interpret­ ation of Article 59 of the EEC Treaty.

By a judgment of 30 March 1979 the By its judgment of 18 March 1980 in Cour d'Appel [Court of Appeal], Case 62/79 SA Compagnie Générale pom- Brussels, in the context of a dispute la Diffusion de la Télévision, Coditei and between Coditei and Others, companies Others v SA Ciné-Vog Films and Others engaged in the cable diffusion of [1980] ECR 881, the Court of Justice in television, and the Belgian distribution reply to the questions submitted, ruled as company, Ciné-Vog, and Others, calling follows : into question the Belgian national legislation on cinematographic copyright, "The provisions of the Treaty relating to stayed the proceedings and referred to the freedom to provide services do not the Court of Justice for a preliminary preclude an assignee of the performing

JUDGMENT OF 6. 10. 1982 — CASE 262/81

The facts which gave rise to this case By its judgment of 30 March 1979, the have already been described in the Cour d'Appel, Brussels, held first that judgment in Case 62/79 Coditei cited the Coditei companies required the above. authority of Ciné-Vog to show the film "Le Boucher" on their networks on 5 January 1971, basing its decision upon Consequently, it is sufficient to recall the Berne Convention on the Protection that by a contract of 8 July 1969 the of Literary and Artistic Works, in the Belgian film-distribution company, Ciné- revised Brussels version of 26 June 1948 Vog, acquired from the producer, the adopted by the Belgian Law of 26 June French company, Les Films La Boétie, 1951, secondly that a performing right the exclusive right to show the film was part of the specific subject-matter of entitled "Le Boucher" publicly in copyright and that consequently Article Belgium for seven years. 85 did not apply and thirdly that the submission based upon Article 59 of the Treaty raised a problem concerning It was stipulated however that the right to broadcast the film on Belgian the interpretation of that provision television could not be exercised until necessitating a reference to the Court of forty months after its first performance Justice. in Belgium, which took place on 15 May 1970. The appellants in the main proceedings appealed in cassation against the first Les Films la Boétie subsequently assigned two decisions contained in that judgment to German television the right to of the Cour d'Appel, Brussels. broadcast the film in question on television in the Federal Republic of By judgment of 3 September 1981 the Germany. On 5 January 1971 the film Belgian Cour de Cassation on the one

hand rejected the submission relating to of the Brussels Bar and by J. Dijck of the an infringement of the Berne Convention Antwerp Bar, by the respondents, and on the other, taking the view Ciné-Vog and Chambre Syndicale Belge that the submission concerning the de la Cinématographie, represented by P. infringement of Articles 36 and 85 of the Demoulin of the Brussels Bar, by the EEC Treaty raised a question as to the Government of the French Republic, interpretation of Community law, represented by Maryse Aulagnon, acting decided to stay the proceedings and to as Agent, by the Netherlands Govern­ refer to the Court of Justice pursuant to ment, represented by F. Italianer, acting Article 177 of the Treaty the following as Agent, by the United Kingdom, question for a preliminary ruling: represented by J. D. Howes of the Treasury Solicitor's Department, acting as Agent, assisted by R. Jacob, Q.C. "Where a company which is the Barrister, and by the Commission of the proprietor of the rights of exploitation of European Communities, represented by a cinematographic film grants by N. Koch, Legal Adviser, and E. De contract to a company in another March, a Member of its Legal Member State an exclusive right to show Department, acting as Agents. that film in that State, for a specified period, is that contract liable, by reason of the rights and obligations contained in Upon hearing the report of the Judge- it and of the economic and legal circum­ Rapporteur and the views of the stances surrouding it, to constitute an Advocate General, the Court decided to agreement, decision or concerted open the oral procedure without any practice which is prohibited between preparatory inquiry. undertakings pursuant to Article 85 (1) and (2) of the Treaty or are those provisions inapplicable either because the right to show the film is part of the II — Observations submitted pur­ specific subject-matter of copyright and suant to Article 20 of the accordingly Article 36 of the Treaty Protocol on the Statute of would be an obstacle to the application the Court of Justice of the of Article 85, or because the right relied EEC on by the assignee of the right to show the film derives from a legal status which confers on the assignee protection erga A — Observations of the appellants in omnes and which does not fall within the the main proceedings class of agreements and concerted practices referred to by the said Article 85?" The appellants in the main proceedings, after recalling the reasoning which led the Cour d'Appel, Brussels, to decide The judgment making the reference was that Article 85 of the EEC Treaty did registered at the Court Registry on 30 not apply to this case, set out the five September 1981. heads on which they base their appeal in cassation against that decision:

Second head: the Cour d'Appel did not preclude the application of Article 85. take account of the cumulative effect of However, "the extent to which the parallel agreements concluded in the prohibition contained in Article 85 industry concerned; applies to the rights protected by Article 36 remains the subject of debate", the argument in particular on the effect of Third head: the Cour d'Appel failed to the distinction made by the Court of make a proper assessment of the Justice between the existence and the inseparable nature of the exclusive rights exercise of the right and the Court's in relation to the agreement as a whole; reference to the specific subject-matter of the right. Fourth head: the Cour d'Appel misinterpreted the effect of the nullity of the exclusive rights; The appellants in the main proceedings Fifth head: the Cour d'Appel failed to next recall the purpose ascribed to reply to a submission that the contract Article 36 of the EEC Treaty in the contained a discriminatory clause. case-law of the Court. That article does not reserve jurisdiction to the Member States; it has always been restrictively Turning next to the question asked by interpreted by the Court and, in any the Belgian Cour de Cassation, the event, can constitute an exception only appellants in the main proceedings are of to the principle of free movement, the the opinion that a negative reply to the other rules of the Treaty remaining second part of the question raised would wholly unaffected; finally, any restrictive be sufficient for the Cour de Cassation measures must be justified. to find fault with the judgment of the Cour d'Appel and that the Court of Justice would then not need to reply to the first part of the question. However, they stress that the Court should Those principles are clearly applicable to nevertheless reply to the first part of the the sphere of industrial and intellectual question raised in order to avoid a property. The appellants in the main protraction of the proceedings before the proceedings point out in that regard that national court. in practice where the owner of an industrial or intellectual property right has recourse to the protection afforded For that reason the appellants in the to him by national legislation, this will main proceedings consider first the give rise to a situation which conflicts general question concerning the with Article 30 and therefore necessitate relationship between Article 36 and recourse to Article 36 only "where he Article 85 and, secondly, the question as seeks to prevent imports from another to the description for the purposes of Member State". In economic terms such Article 85 of the right which the assignee action will necessarily lead to a seeks to enforce. restriction of competition, but Article 85 will apply only if "such recourse constitutes the subject, the means or the (a) The relationship between Articles 36 consequence of an agreement, decision and 85 of the EEC Treaty or concerted practice which, by prohibiting the importation from other The general consensus of legal opinion Member States of products lawfully seems to be that Article 36 does not placed on the market in those States,

would have the effect of partitioning the whose protection is ensured by market". Article 36 in the context of the free movement of goods may also be Moreover, the competition rules are protected under Article 85. intended not only to prevent the partitioning af national markets but also to ensure the maintenance of effective Consequently, the appellants in the main competition. It follows, according to the proceedings propose that the following appellants in the main proceedings, that reply should be given to this part of the purpose and scope of the competition the question asked by the Cour de rules "are wider than those of the rules Cassation: on the free movement of goods, inasmuch as the latter are addressed to "Article 36 lays down exceptions solely undertakings". to the application of the provisions of the Treaty on the free movement of goods. Nevertheless, it is possible to point out The application of the rules on similarities in the interpretation and competition remains unaffected.

status. Interpreted in that manner, the (1) Article 36, as a provision which lays question asks in effect "where in this down exceptions solely to the particular case the line is to be drawn principle of free movement of goods, between the existence of copyright and does not preclude the application of the exercise thereof". The Court of Article 85; Justice, in drawing that distinction itself, took the view that the exercise of such a (2) Where the exercise of the industrial right might fall within the ambit of the or intellectual property right relied prohibitions contained in the Treaty each upon is the subject, the means or time it manifested itself as the subject, the consequence of an agreement the means or the consequence of a which restricts competition, any restrictive practice. Consequently, since consideration of the lawfulness of in this case the intellectual property right such exercise must also take account relied upon by Ciné-Vog unquestionably of the application of Article 85; derives from a contract, it is necessary to (3) An industrial or intellectual property examine that contract in the light of right is not excluded as a matter of Article 85. general principle from the scope of Article 85; Before embarking upon such an exam ination, the appellants in the main (4) However, Article 85 (3) guarantees proceedings first of all raise the matter of to a certain extent that the interests the nature of the contract in question.

JUDGMENT OF 6. 10. 1982 — CASE 262/81

granting an exclusive licence. The of 25 October 1979 in Case 22/79 applicants in the main proceedings share Greenwich Film Production v Société des the Commission's view on this matter bu Auteurs, Compositeurs et Éditeurs de stress that in any event the contract, Musique [1979] ECR 3275. whether it be a licence or an assignment, clearly restricts competition not only because it contains an exclusive-rights clause but also because in the contract there is a first clause in Articles 7 and 8 determining the proportion of the Finally, the appellants consider that, as is receipts to be attributed to the film "La clear from the case-law of the Court, Boucher" where it is shown jointly with any assessment of the restrictive effect of another film and with short supporting a contract must take account of actual films and a second clause to the effect circumstances, and the existence of that the television rights may not be similar contracts is a circumstance which exploited by Luxembourg television until is capable of being a factor in the thirty-two months after their exploitation economic and legal context within which

EEC Treaty. Those principles also apply Consideration should also be given to in matters of copyright, as is dem the reputation of the producer and the onstrated by the Commission's practice principal actors and to the popularity to in that area. which that may lead on the market.

Finally, the appellants in the main clause, tie-in provisions and discrimi proceedings consider that the judgment natory conditions, and by reason of the given in Case 62/79 Coditei cited above economic and legal context surrounding does not alter their conclusions as to the the agreement, it is not possible to unlawfulness of the contract of exclusive dispense with an assessment of the assignment by reason of its compatibility of that performing right incompatibility with Article 85 (1). That with Article 85 on the ground that the judgment was concerned only with the right derives from a legal status." freedom to provide services and was given in response to a request for a pre

In performing rights which are valid not order to do so he has various means at only with regard to the re-transmission his disposal, including contracts granting of television programmes broadcast in exclusive licences. "Whilst there are no another Member State but also with grounds for criticism as regard the regard to live televised re-transmission protection of the owner in the case of and, in particular, cinematographic contracts granting non-exclusive licences, exploitation by other distributors. there is every reason to consider the question of the applicability of Article 85 of the EEC Treaty in the case of Consequently, the appellants in the main exclusive licences." proceedings consider that if, as the Court has stated, the determinant factor, as far In the case of exclusive licences only the as a performing right in a cinemato licences may exercise the rights which graphic film is concerned, is the right of copyright encompasses, whereas the the owner to demand fees, it is inherent owner of the right is prevented from neither in the right to demand fees nor granting other licences, and, as the case therefore in the existence of the per may be, from exploiting his work himself forming right that the latter should be in the territory concerned. exercised exclusively by one of the contracting parties.

JUDGMENT OF 6. 10. 1982 — CASE 262/81

CODITEL v CINÉ-VOG FILMS

European film-production is the film in that State is an agreement possible only with the financial par between undertakings which has as its ticipation of the distributors. The latter object the restriction of competition will agree to make advances only if each within the meaning of Article 85 (1) of distributor established in a given country the Treaty. That agreement may "is certain that he will be the only person constitute an agreement, decision or able to show the proposed film in the concerted practice which is prohibited territory in which he carries on business. and therefore void under paragraphs (1) Thus, the exclusiveness attaching to the and (2) of that article, if the other exercise of a performing right, "which is conditions laid down by Article 85 of the inherent in that right", must be capable Treaty are fulfilled." of being transferred from the producer to the distributor since it is a necessary condition of the risk which the distributor agrees to run.

common market. Those characteristics legitimately be thought that the aim of do not give rise to the application of the Community rules is not be bring Article 85, since they are inherent in the about the ruin of a European commercial nature of the right to show the film, and artistic activity, "the circumstances which is a copyright, by its nature dictate that Article 85 of the Treaty exclusive and capable of being exercised should not apply in this case". as many times as the film is shown. Moreover, it must also be possible, so far as subsequent holders of the right, be However, the law is in confirmity with they assignees or licensees, are the circumstances, as is clear merel) concerned, for the right to remain from a re-reading of the grounds of the

Paragraph 15 could be "restated by D — Written observations of the French replacing Article 59 by Article 85 of the Government Treaty".

The French Government also takes the It is clear from paragraph 16 that Article view that the right of performance is 85 can no more constitute an obstacle to inherent in copyright and does not the geographical limits specified in the constitute an element severed from it. contracts than Article 59. Indeed it is clear from the Berne Convention that the copyright in the work in question comprises both a Finally, it follows from paragraph 17 that non-pecuniary right, perpetual and un­ a performing right may take the form of alienable, relating to the authorship and an exclusive right limited to one Member preservation of the work and an State, without there being an infringe­ economic right which may be the subject ment of Community law. Since Article of transactions between authors and 85 is a provision of Community law, it assignees and relates to the publishing or cannot preclude the grant and exercise of reproduction and performance of the an exclusive right limited to the territory work. Thus, the rights of reproduction

CODITEL v CINÉ-VOG FILMS

the cinema operator. At the same time copyright and the non-exclusive licence the producer gives a guarantee to the granted in respect of that right is distributor, who in turn gives a compatible with the rules on compe guarantee to the cinema operators that, tition. Nor, however, is the intermediate in particular, the work will not be solution, which an exclusive licence broadcast on television. The French represents, prohibited by Article 85 (1), Government emphasizes in that regard since such an agreement embodies the that the widening of the areas of exercise of a right by its owner, in so far reception of television broadcasts due to as the grant of that right represents a cable distribution increases the necessity transfer of the exclusive performing right for "an unequivocal statement of the for a specified period and not a exclusive nature of copyright in the relinquishment of that right.

right of performance". It follows, in question restricts competition, the moreover, from paragraph 14 of that contract not only should gain exemption judgment that the Court recognized "the under Article 85 (3) but also would be supremacy by virtue of Article 36 of the covered by the derogation provided for Treaty of the copyright in a cinemato by Article 36, since the specific subject- graphic film over the Community rules matter of the copyright derives from a on free movement". legal status and consists of the exclusive

JUDGMENT OF 6. 10. 1982 — CASE 262/81

E — Written observations of the Such a situation may arise in particular Netherlands Government from restrictive agreements between proprietors or their assignees or licensees which enable them to prevent imports The Netherlands Government does not from other Member States. propose to consider whether the contract in question is contrary to Article 85 but With regard to the relationship between considers that the present case raises the Article 30 and industrial and' intellectual question as to whether a copyright property rights falling within the ambit whose exercise is compatible with Article of Article 36, the Court has followed a 59 may be incompatible with Article 85, consistent line of reasoning: where it is the subject of a contract. Legislation whose application leads to a In order to reply to that question, the disruption of trade between Member Netherlands Government draws a States must be regarded as a measure parallel between Article 85 on the one having equivalent effect within the hand and Articles 30 and 36 on the meaning of Article 30 of the Treaty; other. With regard to the case where the licensee of an exclusive right seeks to However, Article 36 permits derogations enforce that right, the following from that rule in so far as restrictions on principles may be inferred from the imports are justified on the ground of case-law of the Court concerning Article the protection of industrial and 85 of the EEC Treaty: intellectual property;

Article 36 also applies in the field of The proprietor of such a right may not competition in so far as the existence of however prevent the importation of a industrial and intellectual property rights product which has been lawfully are concerned. The exercise of those marketed in another Member State by rights may, however, fall within the the proprietor himself or with his scope of the prohibitions laid down by consent. Article 85;

That reasoning applies by analogy to the F — Written observations of the United question as to whether a copyright the Kingdom exercise of which is compatible with Article 59 may be incompatible with Article 85 where it becomes the subject of a contract. In its judgment in Case According to the United Kingdom, the 62/79 Coditei cited above, the Court essence of the question asked by the followed a line of reasoning comparable Belgian Cour de Cassation lies in the with the interpretation placed on Articles first part of the question.

station and is subject to copyright must main proceedings, emphasizes the fact be regarded as a separate communication that a declaration that exclusive licences to the public within the meaning of that were contrary to Article 85 would render Convention" and that a separate unworkable the present system of communication to the public of a work making and distributing cinematographic covered by copyright is always subject to works, since the characteristics of film the authorization of the original owner production and of the system for distri or his assignees or licensees. buting films are such that, in order for the system to work, it is necessary in many cases that the transfer of the various rights should be exclusive, par ticularly in the case of distributors, since In conclusion, the Netherlands they will promote the film only if in Government considers that "a contract return they obtain the exclusive right to between the original owner and his

contract". It states that this distinction does not

eflect a genuine distinction in commer­ tantamount to rendering the first Coditei cial reality, since what is important in case a pointless exercise". this context is exclusivity and for that reason it considers that the distinction which it has pointed out between an Turning next to what it refers to as the assignment and a licence has no bearing two reasons suggested by the Belgian on the decision in this case. Cour de Cassation for the non- applicability of Article 85, the United Kingdom maintains, first, with regard to Article 36, that it follows from the judgment of 18 February 1971 in Case The United Kingdom next considers the 40/70 Sirena v Eda [1971] ECR 69 that compatibility of such an assignment or the article is also applicable by analogy exclusive licence with Article 85 of the to matters governed by Article 85. On Treaty. In its view such assignments or that basis the protection of Article 36 is exclusive licences may constitute an also available for the protection òf the infringement of Article 85 but that is by assignee or exclusive licensee on the no means necessarily so. It states that in ground that his right to require fees any event this is a question of fact which forms part of the specific subject-matter is to be determined by the national court. of the copyright. Moreover, in the present case neither the assignment nor the exclusive licence satisfies the requirements of Article 85, since the effect of the assignment or With regard to the legal status of the licence was simply to transfer the licensee, the United Kingdom under­ exclusive right from one party to another stands that under Belgian law the who was in a better position to manage exclusive licensee has been given the it. That transfer neither increased nor right to bring infringement proceedings decreased actual or potential compe­ or their equivalent against third parties. tition, nor did it affect trade between The United Kingdom considers that in Member States. Moreover, the United this case the mere transfer of an Kingdom contends that the Court has industrial property right and the contract already effectively so held in paragraph relating to the transfer cannot as such 16 of its judgment in Case 62/79 Coditei, fall within Article 85, since they do not cited above. involve the creation of artificial barriers to trade between Member States.

The United Kingdom considers that "17. The exclusive assignee of the per­ another possibility would be to follow forming right in a film for the the solution adopted by the national whole of a Member State may court responsible for applying the therefore rely upon his right against decision of the Court in Case 40/70 cable television diffusion companies Sirena. The result none the less, would which have transmitted that film on be that even if the agreement were their diffusion network having technically contrary to Article 85, the received it from a television broad­ copyright could still be enforced against casting station established in the infringer. If, however, the the another Member State, without agreement were to be declared totally thereby infringing Community null and void, it must follow that no law." transfer of the copyright could have occurred, in which case there would be no reason why the original owner of the rights could not enforce them against infringers. Such a decision would Ill — Oral procedure therefore mean that the licensee or assignee would not have the security of being able to enforce the copyright himself or to compel an unwilling At the sitting on 16 June 1962, the licensor to do so and ultimately would appellants in the main proceedings, permit "one party to renege on a deal namely the Coditei companies and which it is in the interests of an efficient Intermixt, represented by G. Kirschen, A. Community film-distribution system to Braun and F. Herbert of the Brussels preserve". Bar, the Union Professionnelle de Radio et de Télédistribution, represented by A. de Caluwé of the Brussels Bar, and Inter-Régies, represented by J. Dyck of the Antwerp Bar, the respondents in the Finally, if the agreement were held to be main proceedings, Ciné-Vog Films and void simply because it involved the grant the Chambre Syndicale Belge de la of an exclusive right, Community law Cinematographic, represented by P. would, in the view of the United Demoulin of the Brussels Bar, the Kingdom, favour unduly the large film- Government of the French Republic, producing organizations, which exploit represented by A. Carnelutti, acting as their film directly throughout the whole Agent, the Government of the Federal of the Community, at the expense of the Republic of Germany, represented by R small independent producer who does Lukes, acting as Agent, the United not have his own Community-wide Kingdom, represented by J. D. Howes, organization. acting as Agent, assisted by H. I. L. Laddie, Barrister of the Middle Temple, and the Commission of the European Communities, represented by N. Koch and E. de March, acting as Agents, Consequently, the United Kingdom presented oral argument and answered considers that the Court should answer questions put to them by the Court. the question asked in the negative and that it need do no more than re-affirm in the specific context of Article 85 what it The Advocate General delivered his stated in paragraph 17 of its judgment in opinion at the sitting on 14 September the first Coditei case, namely: 1982.

5 The court before which the claim was originally made, the Tribunal de Première Instance [Court of First Instance], Brussels, ordered the Coditei companies to pay damages to Ciné-Vog. The Coditei companies appealed against that judgment, and the Cour d'Appel [Court of Appeal], after holding that Article 85 was not applicable to the dispute, submitted to the Court of Justice two questions which, essentially, raised the problem of

CODITEL v CINÉ-VOG FILMS

whether Articles 59 and 60 of the Treaty prohibit the assignment, limited to the territory of a Member State, of the copyright in a film, in view of the fact that a series of such assignments might result in the partitioning of the common market as regards the undertaking of economic activity in the film industry.

6 By judgment dated 18 March ([1980] ECR 881), the Court ruled as follows:

"The provisions of the EEC Treaty relating to the freedom to provide services do not preclude an assignee of the performing right in a cinemato­ graphic film in a Member State from relying upon his right to prohibit the exhibition of that film in that State, without his authority, by means of cable diffusion if the film so exhibited is picked up and transmitted after being broadcast in another Member State by a third party with the consent of the original owner of the right".

State an exclusive right to show that film in that State, for a specified period, is that contract liable, by reason of the rights and obligations contained in it and of the economic and legal circumstances surrounding it, to constitute an agreement, decision or concerted practice which is prohibited between undertakings pursuant to the first and second paragraphs of Article 85 of the Treaty or are those provisions inapplicable either because the right to show the film is part of the specific subject-matter of copyright and accordingly Article 36 of the Treaty would be an obstacle to the application of Article 85, or because of the right relied upon by the assignee of the right to show the film derives from a legal status which confers on the assignee protection erga omnes and which does not fall within the class of agreements and concerted practices referred to by the said Article 85?"

9 The question essentially seeks to ascertain the position, in relation to prohibitions contained in Article 85 of the Treaty, of a contract whereby the owner of the copyright in a film grants the exclusive right to exhibit that film within the territory of a Member State and for a specified period. More particularly, the question asks whether such a grant may possibly fall outside the scope of Article 85 by virtue of the special character attributed to that right by Article 36 of the Treaty or by its protected status under national law.

10 It should be noted, by way of a preliminary observation, that Article 36 permits prohibitions or restrictions on trade between Member States provided that they are justified on grounds inter alia of the protection of industrial and commercial property, a term which covers literary and artistic property, including copyright, whereas the main proceedings are concerned with the question of prohibitions or restrictions placed upon the free movement of services.

15 However, the mere fact that the owner of the copyright in a film has granted to a sole licensee the exclusive right to exhibit that film in the territory of a Member State and, consequently, to prohibit, during a specified period, its showing by others, is not sufficient to justify the finding that such a contract must be regarded as the purpose, the means or the result of an agreement, decision or concerted practice prohibited by the Treaty.

16 The characteristics of the cinematographic industry and of its markets in the Community, especially those relating to dubbing and subtitling for the benefit of different language groups, to the possibilities of television broadcasts, and to the system of financing cinematographic production in Europe serve to show that an exclusive exhibition licence is not, in itself, such as to prevent, restrict or distort competition.

JUDGMENT OF 6. 10. 1982 — CASE 262/81

17 Although copyright in a film and the right deriving from it, namely that of exhibiting the film, are not, therefore, as such subject to the prohibitions contained in Article 85, the exercise of those rights may, none the less, come within the said prohibitions where there are economic or legal circumstances the effect of which is to restrict film distribution to an appreciable degree or to distort competition on the cinematographic market, regard being had to the specific characteristics of that market.

18 Since neither the question referred to the Court nor the file on the case provides any information in this respect, it is for the national court to make such inquiries as may be necessary.

On those grounds,

THE COURT

in answer to the question referred to it by the Belgian Cour de Cassation, by order of 3 September 1981, hereby rules:

A contract whereby the owner of the copyright for a film grants an exclusive right to exhibit that film for a specific period in the territory of a Member State is not, as such, subject to the prohibitions contained in Article 85 of the Treaty. It is, however, where appropriate, for the national court to ascertain whether, in a given case, the manner in which the exclusive right conferred by that contract is exercised is subject to a situation in the economic or legal sphere the object or effect of which is to prevent or restrict the distribution of films or to distort competition on the cinematographic market, regard being had to the specific characteristics of that market.

Mertens de Wilmars Bosco Touffait Due

Pescatore Mackenzie Stuart O'Keeffe Koopmans Everting