Would this have been legal?

June 13th, 2013 at 11:00 am by David Farrar

Tom Pullar-Strecker at Stuff reports:

Chorus made an expensive gamble in rejecting a deal that would have seen it paid just under $14 a month for wholesale copper broadband connections, according to sources close to the failed negotiations.

Chorus’ share price has been on the slide since the Commerce Commission proposed slashing the regulated price of wholesale copper broadband connections by about $12 a month to $8.93 in a draft decision in December.

But the company is understood to have chosen to take its chances persuading the commission to set a higher price or on government intervention.

It is understood all major telecommunications retailers agreed on the compromise price and Communications Minister Amy Adams, who would have had to regulate it over the head of the Commerce Commission, was informed.

The compromise was brokered by the Telecommunications Forum, whose chief executive, David Stone, declined to comment.

I’m not  lawyer, and welcome comment from lawyers who work with competition law. But I thought competitors couldn’t all sit down together and try to negotiate an agreed price level.

It didn’t eventuate in this case, but I think the possible precedent is somewhat alarming. The Commerce Commission is the appropriate body for pricing of monopoly utility services, not a private gathering of retailers with no input from consumers.

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The return of s92A

June 16th, 2009 at 8:46 am by David Farrar

The Dom Post reports that the Government’s review of s92A has been restricted to finding a better process to terminate Internet accounts of copyright infringers, rather than allow a debate on whether termination of Internet access should be a legislated penalty.

It is distressing that the Government is pushing on with such a controversial provision, when the rest of the world is rejecting it. The French Constitutional Court just threw out a similiar French law as unconstitutional.

Child pornography is a far more henious problem than copyright infrngement, but Parliament does not have a law stating that people convicted of child pornography must lose their Internet account.

Run an online fraud, and you will not lose your Internet account – you will just be punished for the actual offending.

Telecommunications Carriers Forum independent chair Richard Westlake says it is disappointed a promised review of the law and its implications has not occurred. “There’s been nothing said or seen which would imply that level of broader consultation and re- thinking has taken place or is in place. There is a working group but we’re concerned the issue has been pre-judged.”

Richard Westlake is correct. The review has been given narrow terms of reference – to come up with a termination model. It is not allowed to come up with a model that does not include termination of Internet access.

Labour’s Clare Curran says:

Terminating internet accounts is a major point of contention. Financial penalties would likely be more effective, she says.

And Clare is correct on this point. No one at all is advocating there should be no penalty for copyright infringers. But the penalty should be a fine that matches or exceeds the value of the infringed material.

Judith Tizard was rightfully blamed for the original s92A. If the Government comes up with a new version that is not much of an improvement, then they will be the ones blamed.

What would be useful is for the Government to clearly state that they are open to solutions that do not involved termination of Internet accounts.

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TelstraClear kill off s92A Code

March 12th, 2009 at 9:53 am by David Farrar

TelstraClear have killed off the TCF Code of Practice designed to try and get workable process around the deeply flawed s92A. They have said they will veto the code at the TCF Board. TCF rules allow any board member to veto.

I was initially pissed off at TelstraClear, because all the hundreds of hours of work put into the code are now wasted. But upon reflection, I think they have have done the right thing by stepping back and saying this law is just so bad, we can;t make it workable through a code. Their submission explains:

TelstraClear considers that there is a fundamental problem with the TCF being a party to any code of this nature, which is that the code would be based on flawed legislation.

In TetstraClear’s view, any industry code would simply be an attempt to tidy up poorly drafted legislation. TelstraClear does not consider this to be the responsibility of the TCF. Indeed the best outcome would be if s92A was repealed. Failing that, it should be amended to address the above concerns:

So there will be no TCF code. The other ISPs can continue work on the code as an unofficial grouping, but it would be madness to have s92A come into force with no code in place.

The submission on the code are very interesting, and I hope MPs look at some of them. Take this submission from the leading IT jurist in NZ – Judge David Harvey. Judge Harvey is also the former Chair of the Copyright Tribunal so about as authoritiative as you can get on this area:

This section is poorly drafted and makes a number of unsupported assumptions, but in essence it suggests that an Internet service provider must develop a policy to cancel an existing contract as a result of copyright infringement.

The reality of the matter is that the cancellation or termination of the contract arises at the behest, not of the Internet service provider, but of copyright owners. Without significant justification in normal circumstances this could amount to an interference with economic relations and raises significant issues about the sanctity of contract.

Judge Harvey further concludes:

section 92A is unnecessary and gives rise to a situation where a person may be deprived of rights under a contract without proper legal process.

Does the Government really want to persist with s92A bearing in mond those comments, and that there will now be no TCF code?

If it had been Parliament’s intention to provide for a process whereby contract termination should take place, Parliament should have provided such process by legislation after proper consultation with all interested parties.

This is basically TCL’s point. You can’t ask private players to determine these rights when the law is so silent on details.

The Australian ISP Association has commented:

As mentioned above, we are aware that a concerted worldwide effort has been made by rights holders in the music and film industries over the past two years to lobby for the introduction of a ‘notice and disconnect’ scheme along the lines of that proposed in the Code. In spite of that, no ‘notice and disconnect’ scheme has been implemented anywhere in the world.

Yay, we could be first. In fact that is why the US groups are pushing so hard – they want us to be an international template.

In all jurisdictions (except France) where the introduction of ‘notice and disconnect’ schemes have been considered and consulted on by Governments, there is now a general move away from any scheme which requires ISPs to terminate internet accounts, on the basis of an allegation of infringement from rights holders.

The whole world except Judith Tizard has realised what a bad idea this is.

Auckland University says:

The main problem is in Section 92A of the Copyright Act which we believe should be removed from the Act or, if it is to remain in some form, then substantially redrafted with input from stakeholders as would have happened during a select committee process.

The Auckland District Law Society:

Section 92A represents a mechanism whereby the copyright holder, an unrelated third party, can interfere with the contractual rights between an ISP and a customer, where the customer is identified as a repeat copyright infringer. Under common law, that could, without significant justification, amount to the tort of interference with contractual relations.

This law is just as flawed as the Electoral Finance Act. When the former Chair of the Copyright Tribunal, the Auckland District Law Society and the country’s largest university says the law needs to repealed or amended, it is time to do so.

National did the right thing by delaying the introduction until a code could be completed. But we now know that unless the law is amended, a code is not going to happen, so time to introduce a bill amending or repealing the clause.

UPDATE: Also worth reading the submission from the Society of Authors. They are as pro-copyright as anyone, yet they say:

The NZ Society of Authors is concerned about the introduction of the proposed s92A of the Copyright Act 1994. Whilst we strongly support the need for measures to control repeat copyright infringement we feel that this clause is not ideal – it has been hastily written and we recommend the need for further discussion.

We feel that should Section 92A be implemented, it is imperative that the Code of Practice be effective and respectful of the rights to freedom of expression.

Radio NZ has said no disconnection should occur without a court order unless there is an independent body established by the Government to rule on any disputes.

And Internet giant Google has also made a submission:

Section 92A puts users’ procedural and fundamental rights at risk, by threatening to terminate users’ Internet access based on mere allegations and reverse the burden of proof onto a user to establish there was no infringement. …

Copyright law is often complex and context sensitive, and only a court is qualified to adjudicate allegations of copyright infringement. Indeed, in Google’s experience, there are serious issues regarding the improper use and inaccuracy of copyright notices by rights holders. In this context, the responsibility should not fall to ISPs to determine cases of infringement.

It is very relevant that Google has testified that many rightholders notices are inaccurate and indeed improper.

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The TCF Copyright Code

February 5th, 2009 at 3:00 pm by David Farrar

Most readers will be aware that a provision of the new copyright law will soon come into force, requiring ISPs to terminate repeat infringers of copyright. The law is badly drafted and does not define how this might work.

In an attempt to give some certainity to ISPs and users, the Telecommunicatons Carriers’ Forum has prepared a Code of Practice for ISPs on how to implement the law.

The code is a draft one, and feedback is sought on it by 5pm Friday 6 March 2009. This affects not just users, but almost every business in NZ, as under the law they could have their Internet access cut off, if their staff are alleged to have downloaded copyrighted material.

The full draft code is here. Overall it is pretty good, as it means you will not get disconnected just on the basis of allegations of infringement, if you dispute the allegation. I can see some fish hooks in it though, and will do a submission. Under the code the process for termination is as follows:

  1. Copyright Holder sends a Copyright Holder notice to ISP, with details of IP address or URL alleged to infringe
  2. ISP sends an (Orwellian sounding) Education Notice to the user who has that IP address or URL, telling them copyright infringement has been alleged.
  3. The user can either do nothing, which signifies acceptance of the infringement, or can dispute they have infringed, or claim to be a downstream ISP with users of their own (many business can claim this)
  4. If you claim to be a downstream ISP, your identity will be revealed to the copyright holder, and under the law you yourself are required to have a policy to terminate users who infringe copyright. So there are risks in being a downstream ISP.
  5. If you dispute you have infringed, this is sent to the Copyright Holder and the infringement education notice is effectively revoked. The Copyright Holder does not learn your identity, however they could prosecute you in court, and that would require your ISP to them identify you.
  6. If you do not dispute your education infringement notice, then you basically at month end get a black mark. You only get one black mark per month regardless of the number of alleged infringements.
  7. After you get three black marks, your fourth black mark is a final warning (if all within 18 months).
  8. If you infringe after a final warning, you get terminated.

The full code has more details. Now some people may think hey I can infringe all I want during a month, and I will only get one black mark. That is so, but remember an ISP can decide to terminate you on its own initiative if it regards you as a serial infringer. The code is the process to be followed for mandatory termination (ie where the ISP is forced to terminate), and doesn’t stop ISPs from acting quicker.

As I said, the code is not too bad. However the Rights Holders don’t like the fact that if you dispute their allegation of infringing, that the ISP will not be forced to terminate you, and their only recourse is to go to court to prove your guilt.

They have come up with a novel solution. That if you dispute the allegation of infringing, then your details should be handed over to them, and they should decide whether your defence has any validity. And if they decide it does not, then the infringement notice counts as a step towards being terminated.

So the copyright holders, under their counter-proposal, would be the prosecution, the judge and the jury. The poor old ISP would still be the executioner though.

The TCF is going to consider their counter-proposal, so I would advocate that people put in a submission specifically on the counter-proposal.

As I said above, I hope to blog my submission in a week or two.

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TCF talks sense on copyright

February 2nd, 2009 at 11:00 am by David Farrar

Some words of wisdom from Telecommunications Carriers Forum CEO Ralph Chivers:

“I can conceive a context within which we have mutually satisfactory commercial relationships that deal with their issues and ours.”

He envisages a win-win for both parties if ISPs can help copyright owners make it easier for consumers to purchase material online legally, in return for ISPs’ co-operation enforcing copyright, and in exchange for a cut of revenues.

“That is an obvious opportunity to explore. We certainly believe part of the issue with copyright infringement is that people can’t access the content they want, in the way they want.

Absolutely. Don’t treat the Internet as an enemy, when it is a massive opportunity.  And ISPs at the moment get double whammied by illegal downloads – downloaders are their most expensive customers, and they also now are expected to act as the unpaid Internet Police on behalf of multi-billion dollar companies.

You will never eliminate illegal downloads, but there is a lot one can do to reduce them, and as Ralph said, you have to make content available as the market demands.

Every movie ever produced should be available for legal download for a reasonable cost. Even maybe when they are still showing on the big screen. Many will still want to see it on the big screen due to atmosphere etc, but people want choice as to how they view a movie.

TV is even worse. Some shows never get shown in NZ. Others come months or years late. Start selling episodes and series over the Net, as soon as they are produced. Gone are the days when TV channels decide when you get to see TV programmes.

The music industry does have more of a right to feel aggrived as almost all songs are now available for easy legal purchase online. However there may still be more they can do to meet market demand – such as a say $250 annual fee to download all the music from one or more studios you want for personal use. The fee could be split amongst artists based on market research of popularity. You could have ISPs offer a download service for $25 a month, where the ISP keeps $5 and the studios say $20. The ISP would then probably locally cache all the songs legally which would reduce their traffic costs and provide them an incentive to stop illegal downloads as those downloads will cost them revenue and increase costs through international bandwidth.

There are lots of innovative solutions out there. None will solve the problem entirely. But forcing ISPs to terminate Internet access to users merely on the basis of alleged infirngements is not the way to do it.

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An unworkable copyright law

September 19th, 2008 at 1:31 pm by David Farrar

Six major ICT groups have put out a statement slamming the new copyright law as deeply flawed and unworkable. The six groups are:

  1. InternetNZ
  2. Telecommunications Carriers Forum
  3. TUANZ
  4. Internet Service Providers Association of New Zealand
  5. NZ Computer Society
  6. Women in Technology

There has never previously been an issue that those groups have joined forces on.

This law was passed last year. I think every party but the Greens voted for it, and it is just a shambles. Even worse the clause that is causing many of the problems was deleted by the Select Committee (I was one of those who sucessfully lobbied for it to be removed) and it was put back in by the Government (but voted for by most parties) at the last minute during the Committee of the House stage.

It is s92A causing the nightmares. It states:

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.

Now what the hell does that mean? Some in the IP industry are saying it means that an ISP must permanently terminate a user from the Internet upon receipt of three complaints alleging copyright infringement.

Note just alleged infringements. Not that you must terminate someone only after they have been found guilty in court.

You could do a parody of an advertisement, and argue that this qualifies as fair use (as permitted under law). If the advertiser disagrees and complains you are on the way to being kicked off the Internet.

Upload to You Tube a video of yourself with the radio on in the background, and you may have infringed copyright of the song on radio, and bang there goes your Internet access.

Don’t believe me. Here’s the NZ Computer Society Chief Executive:

NZCS generally steers clear of criticising laws, however in the case of Section 92a of the new Copyright (New Technologies) Amendment Bill we, like most others in the sector, have to make an exception.

In fact the problem is so large the entire ICT and Telecomms sector is now up in arms about it.

Now let’s get one thing clear. Copyright owners absolutely have the right to protect their intellectual property, and NZCS and others are not for one second saying otherwise. To state it clearly: Copyright violation is a major problem, and we support moves to reduce it.

However to trample all over the rights of computer and internet users, and to place ISPs in the position of potentially having to be the policeman, judge, jury and executioner in what are often vague and unclear situations is completely unreasonable.

This is actually eerily similar to a situation where a power company would be forced to have a policy stating that they must cut the power off to a house, business, school or library (yes, they’re included) if someone on the property used that electricity to do something illegal. I can’t imagine that situation receiving a good reception, so why is this any different?

And here is Ernie Newman from TUANZ:

Few people would disagree that the musicians and others who own copyright to digital content are entitled to have their legitimate interests protected. But a workable balance has to be found between the interests of copyright owners, and those of legitimate Internet users and Internet Service Providers.

Yet for that kind of balance, this Act scores zero out of ten on the NCEA scale. …

I’m struggling to remember a more imprecise piece of legislation. This is just abrogation of parliament’s responsibility.

So what can be done?

Well the good news is the law has not yet come into force. The Government can bring it into force by an Order in Council. I understand they are planning to do this in October.

Lobby Ministers and MPs to have Cabinet delay that section. They can trigger the rest of the new Act, but leave that section delayed to give the Internet industries and Rights Holders tme to come up with a Code of Practice which will give some certainity to how that section should operate.

So if you don’t want to see an unworkable, deeply flawed law come into force next month, start e-mailing or contacting MPs. Otherwise you may find that those three videos you uploaded to You Tube have got you kicked off the Internet, or at leats your ISP.

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