The 'home copy' law is so you can create copies for your own use of material you bought yourself, as long as you keep it to yourself - things like transferring a CD to your mp3 player.
Similarly, it is (was?) legal to download copyrighted material to your own computer for your own use, if you already owned the material.
There is/was another loophole in the copyright law, which states it's not allowed to distribute copyrighted material. However, this law doesn't state anything about receiving and using copyrighted material; it's the distributor / uploader that's responsible for that. And since, in the case of internet piracy, that uploader is often not under Dutch jurisdiction, it kinda falls on its face.
