Telcos, ISPs anxious as digital copyright law changes loom

22 Jun 2011

Telcos and ISPs in Ireland have just more than a week left to respond to proposals aimed at changing Ireland’s copyright laws, which they fear could result in controversial ‘three strikes’ remedies. But it seems changes to legislation aimed at curbing illegal downloads are inevitable.

The news comes as BT and TalkTalk in the UK were yesterday denied an appeal against their challenge of the Digital Economy Act.

Ireland-based ISPs and telecoms firms must have their submissions with the Irish Government by 1 July.

Last month, a process of reform of Ireland’s copyright regime was kick started by the Minister for Jobs, Enterprise and Innovation Richard Bruton, TD, in a move he said was aimed at maximising the potential of Ireland’s digital industries. Bruton is instigating a review of the Copyright and Related Rights Act 2000, which he says will identify any areas of the legislation that might be considered to create barriers to innovation in the digital environment.

However, ISPs fear that changes to Ireland’s copyright legislation will result in a raft of injunctions that will block up the court system and make Ireland unattractive for digital investments.

A spokesperson who wished not to be named said the changes will make ISPs scapegoats for the actions of illegal downloaders and create enormous and costly administrative burdens if injunctions result in them implementing three strikes-style remedies.

“The difficulty here is that content does not reside on the ISP network,” the spokesperson explained. “Illegal material that may be accessed by an ISP’s subscriber passes though the ISP’s network in bits and bytes and passes through the network in milliseconds. Notwithstanding the content is never resident on the network, when the rightsholders go to the ISP several days/weeks later with their court order, the illegal action happened several days/weeks prior and the transmission is over (again there is nothing to remove).

“Regardless of this, where an ISP is a ‘mere conduit’ – a pipe over which content can be accessed – and is not in any way itself involved in the accessing of that content (ie, it itself does not go onto The Pirate Bay website and download illegal material, it’s the subscriber that does this), the ISP cannot be held liable. These provisions are in the Electronic Commerce Directive.

“The rightsholders are not interested in hearing this defence,” the spokesperson said.

Contrary to the ISPs’ point of view, Peter O’Grady-Walshe, chairman of Xtra-vision, said: “As a purveyor of content in Ireland, under the existing copyright legislation, if Xtra-vision was told it was selling illegal or libellous content we would pull every DVD or CD copy of the item in question from every store. If Eason’s was told a publication like a book, newspaper or magazine was infringing copyright or was libellous it would bundle up every copy and send it back to the publisher. However, ISPs know their networks are providing illegal content daily and would rather do nothing.”

A global war between ISPs and rightsholders

The entire issue has been spurred on by a set of legal battles around the world in terms of how telecoms firms and ISPs deal with illegal downloads and file sharing. In France, a decision against ‘three-strikes and you’re out’ remedies was recently overturned. New Zealand recently pushed through a ‘three strikes law’ aimed at punishing copyright theft while in Belgium, the European Court of Justice (ECJ) in recent months found against a verdict that said Belgian ISP Scarlet should filter out copyright-infringing content from its network.

In the UK, BT and Talk Talk yesterday lost a judicial review of the Digital Economy Act which requires the UK government to send legal letters to thousands of illegal downloaders. The legislation will have cost Ofcom and internet providers stg£6m by the time the Digital Economy Act is implemented next year.

Ireland’s exposure to the situation is equally turbulent. In 2009, the major record companies in Ireland agreed to a settlement with Eircom in January 2009, in which the incumbent would agree to implement a ‘three strikes’ policy, whereby illegal downloaders would be cut off from internet access if they were proven to have committed copyright theft.

The labels wanted Eircom to install filtering software, such as Audible Magic, to help prevent the rise of music piracy, which coincided with, and which they believe is responsible for, falling music sales. They said that over the course of six years, sales of music CDs in the Irish market went from €146m to €102m in 2007. Globally, according to the IFPI, more than US$40bn worth of music was illegally downloaded in 2007, up from US$20bn in 2006.

Cable broadband operator UPC emerged as the primary opponent of ‘three strikes’ remedies, which the music industry expected telecoms and ISP firms to apply. It won a High Court victory in October last year.

The judge in the case, Mr Justice Peter Charleton, held that copyright laws seeking to identify and disconnect copyright infringers were not enforceable in Ireland, regardless of the record companies’ complaints.

He said he was cognisant of the financial harm being suffered by record labels due to illegal downloading. “This not only undermines their business but ruins the ability of a generation of creative people in Ireland, and elsewhere, to establish a viable living. It is destructive of an important native industry,” Charleton said.

Proposed legislative changes

According to a document on the Department of Enterprise’s website the department had assumed that rightsholders were able, under two EU directives, to seek injunctions against “intermediaries whose services are used by a third party to infringe a copyright or related right.”

However, the UPC case showed that Charleton was “constrained by the wording of the Copyright and Related Rights Act 2000” and was of the opinion that Ireland had not transposed relevant EU Directives into law – in this case the Copyright/Infosoc Directive 2001 and the Enforcement Directive 2004 which gives rightsholders the right to apply for an injunction.

“In these circumstances and for the avoidance of doubt, it is considered necessary to restate Ireland’s compliance with the directives concerned.”

It must be noted, however, that the Department wants to avoid imposing outright three strikes legislation in Ireland.

“It must be emphasised that this proposed amendment is not about the introduction of a statutory regulatory regime in relation to copyright infringement such as the French “Hadopi” system or the ‘Three strikes’ regime set out in the Digital Economy Act in the United Kingdom.

“In proposing to amend the legislation, the Department is particularly conscious of the importance of online content and digital businesses in the Irish context and, accordingly, is simply seeking to ensure Ireland’s continued compliance with its obligations under the relevant EU Directives following the decision of the High Court in the aforementioned UPC case.”

In February, revealed how, in its final days, the last Government was rushing through statutory instruments that would amend the existing Copyright Act and which would give judges the power to grant injunctions against ISPs in relation to copyright-infringement cases.

It seems that despite telecoms industry protests, wheels are fully in motion to ensure the changes to copyright in Ireland are made and the statutory instruments seem inevitable.

John Kennedy is a journalist who served as editor of Silicon Republic for 17 years