On Thursday, the European Court of Justice in Luxembourg ruled that a national court cannot force Internet service providers (ISPs) to use technical means to prevent illegal file-sharing.

"EU law precludes the imposition of an injunction by a national court which requires an Internet service provider to install a filtering system with a view to preventing the illegal downloading of files," the ECJ said in a statement after the ruling.

The case involved a 2004 case in which SABAM, a Belgian company that manages Belgian writers and composers' copyright holdings, took a Belgian ISP, Scarlet, to court over allegations of copyright violations. As ruled by Belgian courts, Scarlet was forced to install monitoring systems on its users to examine whether they were violating SABAM's copyright holdings.

The ECJ judges found that in this case the right to personal privacy and data protection supersedes the rights of intellectual property holders.

"It is common ground, first, that the injunction would involve a systematic analysis of all content and the collection and identification of users' IP addresses from which unlawful content on the network is sent," the court added in the same statement.

Many European intellectual property owners are worried about unauthorized downloads

"Those addresses are protected personal data. Secondly, the injunction could potentially undermine freedom of information since that system might not distinguish adequately between unlawful content and lawful content, with the result that its introduction could lead to the blocking of lawful communications."

ISPs celebrate the ruling

Not surprisingly, the European Internet Services Providers Association (EuroISPA), a trade group, applauded the move.

"Considering the major contribution that the Internet industry can make to economic recovery, it was indeed not the time to put the innovation of the Internet at risk," said Malcolm Hutty, President of EuroISPA, in a statement.

While this particular level of monitoring may have been rejected, other European countries, most notably France, continue to maintain a system of intellectual property violations monitoring. In France, offenders are given three strikes before being faced with fines and one-month suspension from the Internet.

Author: Cyrus Farivar (AP, Dow Jones, Bloomberg)

Editor: Saroja Coelho