A German court in Hamburg ruled on Friday that Google’s YouTube service did not do enough to prevent its users from posting seven copyrighted music clips without permission.
The suit was brought against YouTube in 2010 by German royalty collections body GEMA and several other groups handling the intellectual property rights to music.
The test case addresses whether online services such as YouTube that allow users to post content can be made responsible for monitoring videos and music clips on their site for possible copyright violations, which some fear will lead to too much internet surveillance.
The court ruled that the video site should install filters that spot when users try to post music clips whose rights are held by GEMA.
The German industry group said in court that YouTube had not done enough to stop copyrighted clips being posted.
YouTube said it took no responsibility for what users did, but responded when told of copyright violations.
GEMA’s court case was based on seven separate music clips posted to the website. However, if YouTube is forced to pay royalties for all the clips used on the site it will face a huge bill.
Gema represents about 60,000 German song writers and musicians.
If enforced, the ruling could also slow the rate at which video is posted to the site as any music clip would have to be cleared for copyright before being used.
Currently, it is estimated that about 60 hours of video is uploaded to YouTube worldwide every minute.
YouTube owner Google has yet to comment on the ruling.
The court case began in 2010 and came after talks between YouTube and GEMA about royalties broke down. In 2009, the stalemate meant that videos from German recording firms were briefly blocked on the site.
GEMA has rung up several victories against sites it has claimed are using music without paying royalties.
In 2009, file-sharing site Rapidshare was told to start filtering songs users were uploading following action by GEMA. In March, 2012 a second judgement told Rapidshare to be more proactive when hunting down content pirated by users.
Music streaming site Grooveshark pulled out of Germany claiming licensing rates set by GEMA made it impossible to run a profitable business in the country.