Italy had brought the case to the EU court after Meta, the owner of Facebook, had challenged implementation of an Italian law requiring information service providers like Meta or Google to negotiate compensation with publishers for online use of their content.
"The right of publishers of press publications to fair remuneration is permissible, provided that such remuneration constitutes consideration for the authorisation granted to providers to reproduce those publications or to make them available to the public," wrote the court in its decision published Tuesday.
It noted that publishers may also refuse to grant that authorisation or grant it free of charge.
The European Publishers Council (EPC) called the ruling "crucial", saying it comes as "AI-driven and platform-mediated uses of journalistic content are rapidly expanding."
"This important ruling will pave the way for fairer negotiations with gatekeepers which have been abusing their dominance by refusing to negotiate in good faith," said the EPC's executive director, Angela Mills Wade.
Meta did not immediately respond to a request for comment from AFP.
Italy's telecom regulator AGCOM in 2023 defined how fair renumeration for publishers would be decided, a decision challenged by Meta, which said it clashed with EU law.
In its preliminary ruling published Tuesday -- which sends the matter back to Italy's courts to decide -- the EU court said Italy's move to seek fair compensation for publishers was indeed consistent with the EU's copyright directive allowing them to "authorise or prohibit" online use of their publications by digital platform.
Obligations on service providers such as those imposed by Italy "make it possible to strike a fair balance between the freedom to conduct a business, on the one hand, and the right to intellectual property and the right to freedom and pluralism of the media, on the other," wrote the court.
The court deemed "justified" Italy's stipulation that service providers furnish publishers the necessary data to calculate fair compensation.
Publishers have been at a disadvantage because only the service providers like Meta have the data to gauge the economic value of publishers' work, it said.
"Accordingly, publishers find themselves in a weaker negotiating position than those providers as regards the determination of fair renumeration," it said.
The EU's sweeping Digital Markets Act (DMA) is a regulatory tool that seeks to rein in the world's biggest tech firms by forcing them to open up to competition in the 27-country bloc.
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