MaGill Case Comment

MacRoberts , Solicitors; Glasgow, Edinburgh & London, United Kingdom

At long last the European Court of Justice has published its decision in the case on refusals to license intellectual property rights, known as Magill. Although the Court held that the refusal to license copyright and lists of television programmes was an abuse of a dominant position, the judgement still leaves questions unanswered.

For those not familiar with the Magill case, the background is as follows: most homes in the Republic of Ireland and around two-fifths of Northern Irish homes are able to receive television programmes broadcast by the Irish State Broadcaster (RTE), ITV and the BBC. Under United Kingdom and Irish copyright law, the BBC, ITV (acting through a subsidiary, Independent Television Publications Limited ("ITP")) and RTE own the copyright in their lists of television programmes. These three broadcasters provided their programme schedules free of charge to daily and periodical newspapers but until 1985 there was no comprehensive weekly listing guide. In 1985 Mr. Magill decided to produce an Irish guide to all channels and complained to the European Commission when the three broadcasters refused to license him to reproduce their weekly listings. His complaint in April 1986 sought a declaration that the three broadcasters were abusing their dominant positions by refusing to grant licences for the publication of their weekly listings and the Commission decided that there was a breach of Article 86 of the Treaty of Rome. The ECJ upheld both the Commission's and the Court of First Instance's view that the refusal by television companies to permit publication of their listings was a breach of Article 86 and prevented publication of comprehensive listings for which consumer demand existed.

The Magill decision is of great importance to owners of Intellectual Property Rights - not just copyright but patents, designs and trademarks as well. Intellectual property rights protect their owners' creative or research investment against third parties and rights of this nature are normally regarded as allowing their holders complete discretion as to whether or not to license their rights.

The importance of Article 86 of the Treaty of Rome is clearly underlined by the Magill judgement and it is a matter of concern to holders of intellectual property rights that a refusal to license, even though there may be no classically abusive behaviour such as price fixing, may infringe Article 86. Although the ECJ has confirmed that the principles in Magill will apply only in exceptional circumstances, it is likely that the judgement will lead to further challenges to holders of intellectual property rights who refuse to license third parties in particular in the field of computers and telecommunications.

Although the judgement appears to be confined to "exceptional circumstances" there is a serious problem with the judgement's lack of clarity and, in particular, its failure to explain in what "exceptional circumstances" it will apply.

Although the author who refuses to license the film rights to his or her book may not be forced to do so, we will need to wait until a less "exceptional" case has been heard before we will be able to see whether the Magill judgement has in fact lessened the rights of intellectual property holders.