According to the Council of State, the provision of sanctions is not supported by a primary law and is therefore unlawful. On the one hand, it is "legitimate that, through the contested regulation, the Authority may—in the face of such unlawful conduct—adopt strictly administrative measures aimed at preventing or inhibiting such conduct," it states. On the other hand, "it is not equally straightforward and automatic (precisely out of respect for the principle of legality) to admit that, in the event of non-compliance with such administrative measures, anyone who fails to comply must for that reason alone bear the burden of a financial penalty in the absence of a primary law that expressly and preventively provides for such a penalty." "And the primary legislative basis, which, in a general and abstract manner, establishes administrative financial penalties for failure to comply with legitimate orders of the Authority, cannot be considered sufficient," the ruling states.

 

«"To complete strict compliance with the principle of legality, this regulatory basis would still need to explicitly provide for the consequence of an administrative fine for failure to comply with an order from the Authority issued specifically and directly to prevent or inhibit the dissemination of copyright-protected products or services via electronic channels. However, this does not appear to be the case in this case," explains the Council of State.

The consequences, explains top lawyer Montagna, are that "Agcom has the power to protect copyright online, but since there are no administrative sanctions for non-compliance with the Authority's orders and warnings regarding copyright, which should have been adopted under primary legislation, it is not possible to sanction, based on general regulations, anyone, whether a provider or website, who decides not to comply with the Authority's prohibition order." Furthermore, "The Council of State now also denies Agcom's sanctioning power not only in relation to copyright, but generally in all areas not covered by primary legislation."«