Section 92A: Shifting the responsibility of copyright enforcement onto ISPs
Emily Mander considers whether section 92A of the Copyright Act 1994 goes too far in protecting copyright
The Copyright Act 1994 (Act) was recently amended in order to bring New Zealand’s copyright legislation up to date with current and emerging technologies, including the one which, for most of us, has become an essential part of our daily lives: the Internet. The amendments attempt to maintain the overall balance within the Act between the competing rights of copyright holders and the users of copyright works. An “Internet service provider liability” regime has been established in sections 92A to 92E, which places third-party Internet service providers (ISPs) in the middle of a private dispute over copyright infringement on the Internet.
There are well-publicised problems and continued controversy around the inclusion of section 92A. Under section 92A, ISPs are required to take an active role in the enforcement of copyright infringement, beyond mere deletion of, or prevention of access to, infringing material on the Internet. Instead, ISPs are further vested with the responsibility of giving effect to copyright holders’ rights through punishing their own users for repeated instances of infringement.
The significant and controversial effect of section 92A is to shift the responsibility for balancing competing rights away from the courts and Government and onto the shoulders of ISPs. Further issues relate to the practical requirements for compliance with section 92A. The Telecommunications Carriers Forum (TCF) recently published a draft Internet Service Provider (ISP) Copyright Code of Practice (draft Code) in an attempt to guide ISPs in meeting their section 92A obligations, though it is possible that the draft Code imposes greater obligations on ISPs than are necessary for compliance with the Act.
ISP liability provisions
The new sections 92A to 92E are intended to deal with situations where Internet users are copyright abusers, but are hidden behind the mask of an IP address. As the ISP is the link between the user and the copyright holder, the Act establishes “ISP liability” provisions which protect ISPs from liability for copyright infringement while still preserving copyright holders’ rights under the Act.
ISP liability provisions are becoming increasingly common in overseas copyright legislation, traditionally drafted in terms similar to sections 92B to 92E. Copyright holders maintain protection against copyright breaches on the Internet, for example through the ability to send a notice of infringement to an ISP for the removal of, or prevention of access to, infringing material. In turn, ISPs avoid liability in situations where the ISP is only a passive player in instances of infringement over the Internet.
Where the contention arises is in the context of section 92A, the “termination policy” provision. It provides:
“92A Internet service provider must have policy for terminating accounts of repeat infringers
(1) An Internet service provider must adopt and reasonably implement a policy that provides for termination, in appropriate circumstances, of the account with that Internet service provider of a repeat infringer.
(2) In subsection (1), ‘repeat infringer’ means a person who repeatedly infringes the copyright in a work by using 1 or more of the Internet services of the Internet service provider to do a restricted act without the consent of the copyright owner.”
This section was included by the Government in the final version of the Copyright (New Technologies) Amendment Act 2008, despite similar wording being removed from the draft Bill by the Commerce Select Committee. Section 92A will come into force on February 28 (sections 92B to 92E were effective as of 31 October last year), due to Parliament’s recognition of the time required for ISPs to prepare and adopt a ‘termination policy’. On February 4, the TCF released the consultation draft for their Code which, when complete, may be adopted and implemented by ISPs to assist them in meeting their section 92A obligations.
Impact of section 92A
A serious implication of the termination policy obligation in section 92A is that it ultimately requires ISPs to police copyright infringement and enforce rights on behalf of copyright holders by cutting off users’ Internet accounts. One factor that exacerbates these concerns is the broad definition of “Internet service provider”, drafted widely enough to include not only commercial ISPs, universities, and Internet-related businesses, but also businesses that employ staff which use the Internet – and that includes your law firm.
Section 92A effectively imposes the work of a court on the shoulders of a commercial – or in many cases, private – entity. ISPs will be required to both make a judgement and carry out the sentence. Within the draft Code, there is also some discretion granted to an ISP in evaluating evidence and determining copyright infringement.
Although the rights of copyright holders may be preserved under the ISP liability regime, it is arguable that some of this is at the expense of the rights and freedoms of others. Users are uncomfortable with the potential for the unqualified termination of users’ accounts by ISPs who fear falling short of the legislative threshold of termination for “repeated infringement”. Of equal concern is the ability for copyright holders to further limit the legitimate “fair use” of copyrighted works by Internet users.
Achieving compliance with section 92A
Although there are concerns in the apparent shift in the responsibility for balancing competing rights, the issue of compliance is an additional practical concern for all ISPs. One difficultly with compliance is the lack of direction in the Act as to what a termination policy must entail in order to meet the section 92A threshold.
There is little clarity as to the interpretation of “appropriate circumstances” and “repeatedly infringes”, terms that are essential to the detail of any termination policy. The Act doesn’t go so far as to require absolute involvement by the ISP in infringement claims (it restricts termination of an account to “appropriate circumstances”), but the words in section 92A are sufficiently vague to leave ISPs reasonably concerned as to whether they will meet the necessary level of compliance.
The 29-page draft Code is intended to aid ISPs in complying with section 92A. It establishes an elaborate process for notification (“education”), warning, counter-notification, expiration, and account termination in relation to copyright infringement by Internet users. Yet extensive procedural requirements can only lead to extra costs for businesses in implementing and executing the TCF’s proposed termination policy.
The draft Code also incorporates the traditional legal concept of ‘innocent until proven guilty’ as well as rules for the admissibility of evidence, which are properly functions of legislation, not voluntary procedure-focused Codes. However, the Act implies Parliament’s acquiescence to a “guilt by accusation” method of copyright enforcement through an avenue that avoids the stringent evidentiary requirements of the courts. In response, the draft Code is attempting to do what it can to lessen the effects of this by providing that users will be “innocent until an ISP has reason to believe, based on evidence that would be acceptable to a court, that a user is a repeat infringer”.
The provisions of the draft Code attempt to ensure the actions of ISPs fairly balance the rights of both copyright holders and users. Although this balance is essential to the Act, the responsibility for maintaining it should remain with the courts and Government. For the most part, this was likely an unavoidable consequence of the Act, as ISPs will be conscious of adequately complying with section 92A, but will also not want to alienate and criminalise their own customers.
A broad remedy for a particular harm
The inclusion of section 92A in the ISP liability sections begs the question of what type of harm this provision was really intended to deal with. It is likely that the most damaging – and most common – source of copyright infringement on the Internet is unauthorised music and video downloading. It was estimated by the International Federation of the Phonographic Industry in its Digital Music Report 2009 (published on 16 January 2009) that 95 per cent of all music downloads are unauthorised, meaning no payments are made to artists or producers.
As a large portion of the music industry’s revenue, it is fair to accept this as a substantial cause of complaint. Yet it is arguable that section 92A is an unnecessarily broad and heavy-handed legislative response to the need to target particular harmful conduct.
New Zealand is not the only country where ISP ‘termination policies’ are mandated by copyright legislation. Australia established a safe harbour regime in its 2004 Australia/US Free Trade Agreement; and the United States requires implementation of a termination policy as a condition on ISP protection against liability under the Digital Millennium Copyright Act 1998.
However, last year the European Parliament voted against including termination policy provisions in Internet and copyright regulations, and just last month the UK’s Intellectual Property Minister made it clear that the UK Government is not planning on regulating for the adoption of a termination policy by ISPs. This may point to a trend of moving away from heavy-handed termination policy requirements, in favour of removing any responsibility for ISPs to maintain the balance of rights between copyright holders and users.
From February 28, we will start to see the effects of a section 92A that requires enforcement of copyright legislation by third-party ISPs, and which will inevitably impact on the important underlying balance between the rights of copyright holders and the users of copyright on the Internet.
Submissions or comments on the draft Internet Service Provider (ISP) Copyright Code of Practice are due by 6 March 2009, and should be sent to Ralph Chivers, Chief Executive, Telecommunications Carriers’ Forum, PO Box 302 469, North Harbour, Auckland or to submissions@tcf.org.nz. Copies of the draft Code are available for free at www.tcf.org.nz/copyright.
Emily Mander is a solicitor with MGF Webb. MGF Webb is a first-tier specialist law firm focusing on technology and regulatory law, serving clients throughout the Asia-Pacific region. MGF Webb is located in Auckland’s Viaduct Harbour and online at www.mgfwebb.com.
NZLawyer, 20 February 2009