back to article Offering Patreon subs in sterling or euros means you can be sued under GDPR, says Court of Appeal

Companies anywhere in the world that offer Patreon subscriptions in pound sterling are subject to EU data protection laws, according to a startling Court of Appeal ruling in England and Wales. The decision, part of an ongoing lawsuit between an Israeli-British man and a US news publisher that allegedly libelled him in a series …

  1. Doctor Syntax Silver badge

    It sounds reasonable. Why should it be different to collecting money here by any other means?

    1. Mishak Silver badge

      On the other hand...

      Does that mean that if a business only accepts USD then GDPR cannot apply?

      1. gerdesj Silver badge
        Paris Hilton

        Re: On the other hand...

        No. Here GBP and EUR are used as evidence of something, their lack does not imply the opposite.

      2. eldakka Silver badge

        Re: On the other hand...

        > Does that mean that if a business only accepts USD then GDPR cannot apply?

        If it doesn't operate in UK/EU, then yes.

        The judgement is that offering transactions in the local currencies (£/€) is tantamount to operating in the UK/EU. It is expanding the definition of what it means to be operating in the UK/EU for GDPR purposes.

        Therefore either physically operating in the UK/EU (i.e. a local office) or effectively operating in UK/EU (trading in £/€) is sufficient to establish the link for GDPR purposes. It's not an "and", it's an "or", both don't have to be true. If the ruling stands that is.

        1. stiine Silver badge

          Re: On the other hand...

          So, any transaction completed in USD means both merchant and customer are under US law? What about a British bank that will convert your leftover vacation Dollars into Pounds? Does that mean every one of that bank's customers are also subject to US law? Don't give them (the USGov) any ideas.

      3. katrinab Silver badge
        Meh

        Re: On the other hand...

        No, it merely removes one of the reasons why it could apply. There may be other reasons for it to apply.

      4. Doctor Syntax Silver badge

        Re: On the other hand...

        I'm not sure why you got the downvotes as it is actually a good question.

        AFAICS that wasn't a situation the court was asked to decide on so it didn't decide on it. The choice of currency was taken as an indication of trading in the EU (including the UK at the time). Presumably this was what the complainant argued. If they only accepted dollars there may have been other indications for the complainant to argue and the court to accept or reject as it considered appropriate.

        If they only accepted USD and specifically said "Not available in the EU" or maybe USD and other non-EU currencies the situation might have been different but you'd need to see how a court ruled in those circumstances to be sure.

        Case law grows by interpreting the legislation in relation to specific sets of circumstances.

        1. LybsterRoy Bronze badge

          Re: On the other hand...

          Its probably just me but I are our courts generally and quietly going bonkers?

          What the judgement says to me is that if a company is prepared to take the ForEx risk and allow its customers to pay in a different currency then they are regarded as being domiciled in the country of the currency. Presumably they'll need to register for taxation and maintain accounts for the country as well.

          Alternatively the company is subject to the law of country £ for that bit of its operations but not that bit - DUH.

          1. Alan Brown Silver badge

            Re: On the other hand...

            "Its probably just me but I are our courts generally and quietly going bonkers?"

            They're not. This is a longarm statute issue

            If accepting payment in those currencies then it's doing business with residents of those countries and therefore subject to their laws. The general rule of thumb for defamation cases is that defamation occurs in the jurisdiction the reader lives in

            1. aks

              Re: On the other hand...

              It's still not definitive. The pound sterling is used in a number of locations outside of the UK and EU. I don't know if all of those locations / jurisdictions have implemented GPDR.

        2. bombastic bob Silver badge
          Devil

          Re: On the other hand...

          Case law grows by interpreting the legislation in relation to specific sets of circumstances.

          In the US, as I understand it (and IANAL) there's no legal precedent without an appellate judge ruling on it, and possbly in several jurisdictions, before it can be used effectively in future cases.

          Otherwise it is just one judge's opinion. (I would expect UK law to be similar)

          Still a libel lawsuit against a "fact checking" news organization might be fun to watch. Let's see just how good their "fact checking" REALLY is... or whether they are yet another pipe organ for agenda-driven activists.

          1. pnoligistonol
            FAIL

            Re: On the other hand...

            You asked for an appellate Judge Theo? I give you the Court Of Appeal

            ("Offering Patreon subs in sterling or euros means you can be sued under GDPR, says Court of Appeal")

      5. I Am Spartacus

        Re: On the other hand...the corollary

        Does this mean that a UK company accepting payment in USD becomes subject to US Law, and more importantly, US tax policy?

        1. heyrick Silver badge

          Re: On the other hand...the corollary

          A while back, a musical group (Dutch, IIRC) were awarded a successful copyright infringement ruling in the US, but they were not awarded any damages because their music was not registered for copyright in the US, despite this not being a requirement in their country (or any other country in the Berne Convention).

          So in response to your question, I think "if and when it suits them" would be the most appropriate answer.

          1. TurtleBeach

            Re: On the other hand...the corollary

            IANAL but not completely true regarding copyright in the US. The copyright must be registered TO SUE FOR AND POTENTIALLY receive damages in the event of infringement. No registration is required in order to secure a copyright, and in the event of litigation, be successful in proving ownership (as demonstrated in the case you mentioned). An after-the-fact (after winning in litigation) registration will then provide a path for FUTURE damages, but not for retroactive damages as a result of infringement prior to registration,

        2. katrinab Silver badge
          Meh

          Re: On the other hand...the corollary

          Not necessarily. Certainly not US tax policy.

          There are actually more US$ spent in the UK than in the USA, thanks to The City of London.

          Also, if for example, you own an oil field in the North Sea (Scotland), and sell 1 million barrels of oil to a refinery in Grangemouth (also Scotland), your invoice will be for $76,240,000, not £56,530,000.

          1. Anonymous Coward
            Anonymous Coward

            Re: On the other hand...the corollary

            Does crude oil being priced in US dollars mean that the transactions actually take place using US dollars?

            1. David 132 Silver badge
              Happy

              Re: On the other hand...the corollary

              No. Triganic Ningis. Which explains why the energy market is a little dysfunctional lately.

              1. Chloe Cresswell

                Re: On the other hand...the corollary

                You'd think they'd have made enough to own a Pu...

                1. MrDamage Silver badge

                  Re: On the other hand...the corollary

                  It's fiddly small change, so they keep losing it down the back of the sofa.

            2. katrinab Silver badge

              Re: On the other hand...the corollary

              Yes. The payment would be made by US$ bank transfer, most likely between two UK banks.

        3. dajames Silver badge

          Re: On the other hand...the corollary

          Does this mean that a UK company accepting payment in USD becomes subject to US Law, and more importantly, US tax policy?

          I suppose it might in the eyes of any US legislators or tax officials who saw some benefit in making it so.

          Really, though, it shouldn't as there are other countries in the world -- and, indeed, certain market sectors -- where the US dollar is the de facto currency of choice. Accepting USD in payment might be an indication that a company intends to do business in one of those countries/sectors, and not in the US at all.

          1. aks

            Re: On the other hand...the corollary

            On the other hand, the USA might be reluctant to make its currency less attractive as a medium of exchange. As I remember, moves by Middle Eastern countries such as Iraq under Sadaam Hussein were suggested as possible motives for his removal. China is moving to strengthen its own currency as a medium of exchange.

        4. IHateWearingATie

          Re: On the other hand...the corollary

          US courts tend to take a very wide view of what is in their territorial jurisdiction. The best assumption you can make is that if you have a map with the USA marked on it in your house, or know what the capital of the USA is, their courts will assume they own your ass.

          1. Yet Another Anonymous coward Silver badge

            Re: On the other hand...the corollary

            But I use Helvetica font so I have Swiss secrecy behind me

  2. tiggity Silver badge

    Interesting decision

    Don't see how accepting certain currencies leads to that leap of logic.

    All it seems to me is that its taking account of different payment preferences, used to work on software with and so (obviously to be more user friendly to potential customers) Euro and US dollar was offered as an alternative to UK sterling (with a bit of markup to cover currency fluctuation rates, costs of conversion to sterling, and Euro and dollar prices frequently updated (automated) to make sure no big hits from unpleasant exchange rate wobbles)

    As it was digital download then no knowledge of customer location (use of dollar not necessarily US, ditto Euro use may not mean EU ... I used to have a EU bank account in Euros for a while as on a contract where I was paid in Euros and worked out better value than UK banks "interesting" exchange rates applied if banking Euros in a sterling account)

    I fail to see how being nice to customers like that implies implicit use of EU data protection rules.*

    * irrelevant as company was GDPR compliant (when I was there, no reason to assume its changed)

    1. General Purpose Silver badge

      Re: Interesting decision

      See para 97 of the ruling:

      "On the evidence, the defendants did more than merely making their journalism accessible over the world wide web. They intended to make their output available in the UK and EU, and succeeded in attracting a more than minimal readership. In due course they expressly solicited subscriptions from within the UK and EU, via the Patreon platform. They succeeded in securing three subscriptions in sterling and three in Euros. This may be “minimal” activity but nothing more is required, according to the authorities."

      1. HildyJ Silver badge
        Holmes

        Re: Interesting decision

        "the company's Patreon page offered basic subs at £4 ($5.36) a month, or £46 ($61.73) a month"

        I think the round numbers for the pound subscriptions clearly show their intent.

    2. katrinab Silver badge

      Re: Interesting decision

      Most Patreons are priced in US$.

      If you are in the UK, Patreon will probably convert it to £ for you, or if they don't, your bank will if you pay from a £ account. But this company was actually pricing the subscriptions in £.

      1. Joe W Silver badge

        Re: Interesting decision

        Plus the conversion rate is not stable in time when the offer is in USD, and then converted by a website script, bank or PayPal. Pinning the price in GBP or EUR to a fixed value implies quite a bit more involvement in the EU and the UK, and tayloring your offers to that market. Whether that's a reasonable assumption is for the Information Commissioner and the next court to decide. I can sort of follow the argument - though I am not sure if I really like the conclusion and the can of worms this implies.

        1. General Purpose Silver badge

          Re: Interesting decision

          It turns out they didn't just imply involvement. Para 85 of the ruling has

          "the first defendant tweeted, and the second defendant re-tweeted “Everyone in the UK or EU can now pledge to Patreon in their local currency of Euros or Pounds. This will help prevent you paying extra conversion fees from your bank.”"

          1. Mixedbag

            Re: Interesting decision

            And that is probably the key point of the finding.

            I had to go and check my memory as I thought GDPR was actually broad enough to always apply if the data subject or the data controller was a subject of a signed up country but from the guidance there does also have to be a targeting of the individual that had entitlement to those rights. So an incidental customer/user is fine but if you market to a UK/EU citizen then GDPR absolutely applies.

            https://ec.europa.eu/info/law/law-topic/data-protection/reform/rules-business-and-organisations/application-regulation/who-does-data-protection-law-apply_en.

            The GDPR applies to:

            a company or entity which processes personal data as part of the activities of one of its branches established in the EU, regardless of where the data is processed; or

            a company established outside the EU and is offering goods/services (paid or for free) or is monitoring the behaviour of individuals in the EU.

            If your company is a small and medium-sized enterprise ('SME') that processes personal data as described above you have to comply with the GDPR. However, if processing personal data isn’t a core part of your business and your activity doesn't create risks for individuals, then some obligations of the GDPR will not apply to you (for example the appointment of a Data Protection Officer ('DPO')). Note that ‘core activities’ should include activities where the processing of data forms an inextricable part of the controller’s or processor’s activities.

            Examples

            When the regulation applies

            Your company is a small, tertiary education company operating online with an establishment based outside the EU. It targets mainly Spanish and Portuguese language universities in the EU. It offers free advice on a number of university courses and students require a username and a password to access your online material. Your company provides the said username and password once the students fill out an enrolment form.

            When the regulation does not apply

            Your company is service provider based outside the EU. It provides services to customers outside the EU. Its clients can use its services when they travel to other countries, including within the EU. Provided your company doesn't specifically target its services at individuals in the EU, it is not subject to the rules of the GDPR.

          2. Doctor Syntax Silver badge

            Re: Interesting decision

            I don't think the judgement actually comments on this (at least it didn't before my eyes glazed over) but the implication seems to be that they knew, or at least assumed, some dollar subs were already coming from the EU and the subsequent half dozen UK or EU subs might only be a subset of those.

          3. Phil O'Sophical Silver badge

            Re: Interesting decision

            That's a joke. In my experience, letting a foreign company convert to "my" currency and billing me in that always results in a higher cost than billing me directly in USD or Euro and letting my bank handle the conversion.

          4. Falmari Silver badge

            Re: Interesting decision

            @General Purpose “Everyone in the UK or EU can now pledge to Patreon in their local currency of Euros or Pounds."

            Well not everyone in the EU can, as not all Countries in the EU use the Euro.

            Did they also offer payment in other EU currencies such as the Danish krone?

            If they did not it could be argued they were just offering payment in 3 of the world major accepted currencies. The "local currency" part was just highlighting a bonus side affect of doing that.

            1. General Purpose Silver badge

              Re: Interesting decision

              The first defendant tweeted, and the second defendant re-tweeted “Everyone in the UK or EU can now pledge to Patreon in their local currency of Euros or Pounds. This will help prevent you paying extra conversion fees from your bank.” That's one reason the judge found that "they expressly solicited subscriptions from within the UK and EU." It doesn't matter that the defendants were exaggerating.

    3. DS999 Silver badge

      So if a UK based business

      Accepts payment in $ I guess US courts should hold them subject to US law, like for example having to respond to US subpoenas? I don't think this ruling is all that good for UK sovereignty.

      1. eldel

        Re: So if a UK based business

        US courts typically assume everyone is subject to US law. Lord Palmerston would be proud of them,

        1. DS999 Silver badge

          Re: So if a UK based business

          Except if the US government tried to enforce such a subpoena in a UK court, they could use this UK ruling as precedent.

          It would be a lot easier trying to enforce something like that in the home country's court when you have such a juicy precedent sitting there waiting to be cited.

      2. Anonymous Coward
        Anonymous Coward

        Re: So if a UK based business

        That's what they do to force companies using any company that needs to use USD to stop dealing with Iran. Such an overreach of power.

  3. msobkow Silver badge

    Mental note: Never accept payment in anything but Canadian or US dollars.

    The rest of the world is nuts...

    1. Anonymous Coward
      Anonymous Coward

      Like any smart squirrel, I only accept payment in acorns.

      1. Kevin Johnston

        Would those acorns be the whole atom or just one electron?

        1. Chloe Cresswell

          10 electrons, or one BBC model b... ;)

          1. msobkow Silver badge

            As a Canadian, even USD is only a grudging option.

            If offering UK or European potential customers a convenient payment option means you have to buy into the whole GDPR overhead and rigamarole, it just flat out is not WORTH the business unless you are going to be moving major volume in those markets. GDPR is awfully expensive to implement for Joe's Online Fishing Tackle Shop that just happens to sell some flies that the French fishermen like.

            1. John Brown (no body) Silver badge

              FWIW, complying with GDPR as a small business basically means playing nice with peoples personal data, ie making sure it's as safe as reasonably possible and not selling it on, and that's pretty much it. Something businesses really ought to be doing anyway.

            2. edge_e
              Facepalm

              Re: GDPR is awfully expensive to implement

              Why do you think it's expensive to only use data for the stated purpose and to not retain it any longer than you need it?

              1. msobkow Silver badge

                Re: GDPR is awfully expensive to implement

                It is the paperwork and lawsuits over compliance such as in this case that are at issue.

                Businesses are subject to the regulation of their home nation, NOT the EU.

                1. DJO Silver badge

                  Re: GDPR is awfully expensive to implement

                  Businesses are subject to the regulation of their home nation, NOT the EU.

                  NO - Businesses are subject to the regulation of the countries in which they do business.

                  You want to sell in the EU then those transactions are rightly subject to EU law.

                  1. LybsterRoy Bronze badge

                    Re: GDPR is awfully expensive to implement

                    With the internet you may not be selling in the EU, however, the buyer may be in the EU.

                    A little thought experiment - fly to the US, take out one of these subscriptions whilst you're there. For your "convenience" select the GPB option. Now fly home. Whose law applies?

                    1. DJO Silver badge

                      Re: GDPR is awfully expensive to implement

                      There are multiple transactions there.

                      The purchase is taxed and subject to the laws of wherever you made the purchase. It may also be subject to further duties or taxes when you fly home.

                      But the product is subject to the regulations of the country it is delivered to.

                      All simple, logical and obvious.

                  2. msobkow Silver badge

                    Re: GDPR is awfully expensive to implement

                    Well, then, the EU market can take a flying leap. :(

                2. John Brown (no body) Silver badge

                  Re: GDPR is awfully expensive to implement

                  "Businesses are subject to the regulation of their home nation, NOT the EU."

                  You might want to mention that to the USA too. We've seen many, many cases of the USA claiming jurisdiction outside their borders in these pages. eg Patriot Act etc. The EU isn't doing anything different.

  4. Missing Semicolon Silver badge
    WTF?

    Any business

    So any business that has a switch on its web site to show prices in £ sterling is now subject to GDPR? News to AliExpress and the like, methinks.

    Lord Justice Warby has form on inventing new law by precedent.

    1. Chris G Silver badge

      Re: Any business

      Aliexpress like many other businesses are subject to more than just GDPR, they ate also obliged to collect VAT at point of sale now, something that has come in within the last year.

      That also applies to eBay when for example buying items from eBay.com (US) for shipment to Spain.

      1. Quando

        Re: Any business

        Some Patreon subscriptions listed in £'s are subject to VAT too - I have two in £'s, one gets VAT added the other doesn't. Not sure about $ subscriptions as I don't have any of those.

        1. katrinab Silver badge

          Re: Any business

          All Patreon subscriptions should be subject to VAT, but Patreon is responsible for that, not the content provider.

    2. Doctor Syntax Silver badge

      Re: Any business

      "Lord Justice Warby has form on inventing new law by precedent."

      That's the nature of the job and, in fact, the law.

      1. Irony Deficient Silver badge

        Lord Justice Warby has form on inventing new law by precedent.

        That’s the nature of the job and, in fact, the law.

        That is the most important difference between a legal system based on common law and a legal system based on civil law; it is a defining component of Lord Justice Warby’s job which is not available to most of his counterparts in the EU.

        1. Doctor Syntax Silver badge

          Re: Lord Justice Warby has form on inventing new law by precedent.

          He also delivers his judgements in English which is also not available to most of his counterparts in the EU. Your point is????

  5. Snowy Silver badge
    Coat

    Six that is a lot

    Where they taken out before or after they allegedly libelled him in a series of stories?

    Would be funny if it turned out the Patreon subs where taken out by him or people know to him when he tries to sue and failed.

  6. Falmari Silver badge
    Mushroom

    GDPR -> Libel

    I did not know that if you are subject to GDPR you are subject to the libel laws of GDPR jurisdictions.

    This ruling means any news outlet that offers subscriptions in sterling are subject to UK libel laws as well as those of the jurisdiction they are in.

    For example, The New York Times offer a subscription for £0.50 a week. This ruling means they are subject UK libel laws.

    What other laws does GDPR make you subject too. If a UK court issues a press injunction would that also apply to The New York Times?

    1. Insert sadsack pun here Silver badge

      Re: GDPR -> Libel

      The libel issue and the GDPR issue are different. The two have different mechanisms for establishing jurisdiction to sue in England and Wales.

      1. Falmari Silver badge

        Re: GDPR -> Libel

        @Insert sadsack pun here "The libel issue and the GDPR issue are different."

        I agree, the conclusions of my post were wrong. +1.

        I had to read the appeal PDF again to see it does separate them (see 123 of PDF). Part of my confusion was due to GDPR has some overlap with the claims in libel (see 74 of PDF).

  7. Norman Nescio Silver badge

    Targetting customers in jurisdiction where GDPR is in force

    Hmm.

    I get the argument, and I can definitely see that offering a payment option in a currency used solely* in a GDPR-covered country can be construed as deliberately inviting custom from people in that country: therefore GDPR applies.

    It will be interesting if someone looks at delivery services. If you offer a delivery option of physical goods to a GDPR-covered country, I suspect it could well be construed in a similar manner. That really would set the cat amongst the pigeons, with the ultimate effect being that if suppliers do not wish to be bound by the GDPR, they simply cease to deliver to GDPR-covered countries. Whole swathes of on-line offerings could well become unavailable to consumers, unless some other organisation steps in as an intermediary (for a fee, of course). Interesting.

    NN

    *There might be a loophole. The Holy See/Vatican City uses the Euro as its currency, as does Andorra, Kosovo, Monaco, Montenegro, San Marino, and Akrotiri & Dhekelia so you could argue that you are targetting those territories and most definitely not the EU - it would depend if any or all of them have incorporated the GDPR into local legislation. Is it part of Roman Catholic canon law?

  8. jollyboyspecial Bronze badge

    This is a step in the right direction.

    The US seems to think it's laws should apply to foreign companies just because they say so. At least this sets a firm legal basis for the law to apply the other way. And it seems to be a perfectly reasonable application of the law to me.

    1. msobkow Silver badge

      Every nation thinks their laws should apply to their companies; the US is NOT alone in that regard. You think I want to research UK/EU law and regulation to run my consulting business in Canada? Even if I were to ever take on an EU client, it would still be under the auspicies of Canadian law; I'd insist on that in the contract.

  9. AVR

    Enforcement

    How easy would it be to get a judgement made in the UK (based on UK law without a direct equivalent in the USA) enforced on a USA-based company? I'm not familiar with how the law works in this area.

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