The ECJ rules on the criterion of material reciprocity pursuant to Art. 2(7) of the Berne Convention

The European Court of Justice (ECJ), with its judgment of 24 October 2024 in C-227/23, clarified that, pursuant to Directive 2001/29/EC on the harmonisation of certain aspects of copyrights (the Directive), Member States cannot apply the criterion of material reciprocity provided for by Article 2(7) of the Berne Convention to works of applied art from third countries.

The dispute that gave rise to the ruling was initiated by Vitra Collections AG, a well-known high-end design furniture company, and Kwantum Nederland BV, which marketed a chair that allegedly infringed Vitra's copyrights to its “Dining Sidechair Wood” (DSW), designed by American designers Charles and Ray Eames.

The Netherlands Supreme Court, before which the case was pending, referred the case to the ECJ for a preliminary ruling, essentially asking whether EU Member States may limit the protection of works of applied art under the criterion of material reciprocity established by Article 2(7) of the Berne Convention, which states: “Works protected in the country of origin solely as designs and models shall be entitled”, in other countries adhering to the Convention, “only to such special protection as is granted in that country to designs and models”.

In replying to this question, the CJEU first recalls that, pursuant to the Directive:

i)            works of applied arts are protected by copyright if they possess the requirements of originality and identifiability;

ii)          their authors are granted the exclusive rights to authorise or prohibit the reproduction and distribution to the public of their works;

iii)         the scope of the Directive is the internal market, that is, the territories of the Member States, without regard to the country of origin of the work or the citizenship of its author.

In essence, “where a subject matter may be classified as a ‘work’ within the meaning of Directive 2001/29, it must, as such, qualify for copyright protection, in accordance with that directive” which “does not lay down any condition relating to the country of origin of the work in question or to the nationality of the author of that work”. This is in line with the very purpose of the Directive, which seeks to avoid significant differences in protection within the EU internal market and, consequently, restrictions on the free movement of services and products protected by intellectual property: this objective “would be infringed if Directive 2001/29 were to regulate only the protection of works which originate in a Member State or whose author is a national of a Member State”.

In light of this, the application by Member States of the above-mentioned criterion of material reciprocity would be contrary to the provisions of the Directive and also to its harmonisation purpose, because works originating from third countries could receive different protections in different Member States.

Moreover, the ECJ continues, intellectual property rights (including copyrights) are protected under Article 17(2) and Article 52(1) of the Charter of Fundamental Rights of the EU, according to which any limitation on their exercise must be provided for by law. In the present case, the application by a Member State of the criterion of material reciprocity constitutes such a limitation, because it is capable of depriving the holder of the rights of the possibility to enjoy and exercise those rights in the territory of the Member State applying that criterion. However, there is no provision of EU law that allows such a limitation; and only an EU provision could allow it, not a national provision, since, in adopting the Directive, the EU has replaced the Member States in the relevant matter.

Furthermore, the ECJ states, it is true that the purpose of the Directive is to harmonise only some aspects of copyrights. However, the limitations to the authors’ exclusive rights are comprehensively listed in the Directive itself, hence there is no margin of discretion that allows Member States to introduce other limitations such as the principle of material reciprocity.

Finally, the Court also analyses the issue from the point of view of Article 351 TFEU, according to which the provisions of the EU Treaties do not affect the rights and obligations arising from conventions concluded between Member States and third States before 1 January 1958 (or the subsequent date of accession to the EU). The Berne Convention, the ECJ states, is indeed one of these conventions, and yet:

i)            where, as in this case, a convention allows, but does not require, the Member State to adopt a measure contrary to EU law, the Member State must refrain from adopting it; and

ii)          where, due to a development of EU law, a rule adopted by a Member State in accordance with a previous international convention becomes contrary to EU law, that Member State cannot rely on the convention to exempt itself from EU law obligations which arose at a later date.

In conclusion, the ECJ ruling provides for enhanced protection for applied works of art (including industrial design) in the EU, eliminating the risk of differentiated treatment for works and authors from third countries and contributing to greater uniformity in the protection of works in the internal market.