Section 92A back to drawing board - but implications remain

Although the government has decided that the controversial Section 92A of the Copyright (New Technologies) Amendment Act 2008 is to be rewritten, businesses should not relax about their internet risks just yet.

Currently, 94% of New Zealand businesses with over 20 employees, and 64% overall have internet connections. Under S. 92A internet service providers (“ISPs”) were required to “adopt and reasonably implement” a policy providing for termination of “repeat infringer” internet accounts. The Act’s ISP definition is wide, and could include libraries, schools, internet cafes, or any business that offers internet access to the public, staff or clients.

Under S. 92A, detection of copyright infringement via a business’s internet connection could have meant loss of its internet service as well as exposure to civil law claims, and criminal liability if deemed “commercial” infringement. Breaches could range from businesses hosting infringing material on their websites to employees illegally downloading movie or music files for personal use or uploading them to file-sharing websites.

The Telecommunications Carriers’ Forum (“TCF”), which includes ISPs Orcon, Telecom, TelstraClear, Vodafone and Woosh, had been trying for some time to negotiate an ISP Code of Practice with the Recording Industry Association of New Zealand (“RIANZ”) representing copyright holders. There was also input from international copyright interests.

The back-pedal on S. 92A has been applauded by RIANZ and TCF. Both had decided the legislation was too hard to work with and were unable to agree who would have responsibility for the costs of monitoring and administrating the enforcement scheme. User groups, which had deemed S. 92A “guilt by accusation”, and wanted it scrubbed altogether, were relieved if not satisfied.

Minister of Commerce Simon Power wants the amended legislation to better meet the concerns and interests of ISPs, copyright holders and internet users, as well as the government.
Problems identified with the legislation included:

• no definition of “infringer”;
• uncertainty as to burden of proof; and
• the inappropriateness of ISPs having to determine legal liability.

It is unlikely there will be fundamental changes to the thrust of the legislation, due to New Zealand’s international treaty obligations to protect digital copyright, and the government’s ambitions for a U.S. Free Trade Agreement.

Australia has similar problems, its Copyright Act 1968 (as amended) containing exactly the same wording as S. 92A, and referring to an equivalent industry code (yet to be established).

A test case by major film studios is currently in progress against Australian high-speed ISP iinet, claiming it allowed its users to download films and ignored their infringement notices. The studios say they had provided IP addresses of thousands of copyright infringers but iinet took no action. The options available to iinet, according to the studios, were to send a notice, limit download speeds or suspend browsers. However the ISP claims it met its obligations by forwarding all information it received to police.

Simon Power has not set a deadline for amending S. 92A, but possible changes include:

• Adopting a “notice and notice” format, rather than “notice and takedown”;
• right of appeal to a mediator when a notice is sent to a user;
• Establishing an arbitration body to administer the scheme and monitor internet use. This would remove the obligation from ISPs to monitor and remove their own users, or mediate between copyright holders and users.

In preparation for the legislation coming into force, businesses should at least:

• Educate staff about copyright;
• Cover the issue in employment agreements;
• Institute in-house codes of conduct; and
• Install filters and block infringing websites.

By Michael Battersby / Rebecca Collins – First published in Business to Business April 2009 issue, Vol. 18 No.4.