The Luxembourg-based European Court of Justice (ECJ) ruled in a case involving two Belgian companies, music royalty collecting society SABAM and online social network Netlog.

SABAM asked a Belgian court in 2009 to order Netlog to stop its users illegally downloading songs from the society's portfolio. The Belgian judges sought advice from the Luxembourg court.

But the ECJ backed Netlog. "The owner of an online social network cannot be obliged to install a general filtering system, covering all its users, in order to prevent the unlawful use of musical and audio-visual work," the ECJ said in a statement.

"Such an injunction would result in a serious infringement of Netlog's freedom to conduct its business since it would require Netlog to install a complicated, costly, permanent computer system at its own expense," the court stated.

Judges also said forcing companies to install a filter to identify, analyse and process users' personal information might infringe their privacy and could result in the blocking of lawful content.

"This decision is a fundamental for the development of the Single Digital Market in the European Union, because it gives greater legal certainty to Internet providers and ensures protection for the right to publish content without prior censorship," said Innocenzo Genna, internet regulation consultant.