ISPs: New copyright law puts business in the gun; scrap it

The Internet Service Providers Association of New Zealand (ISPANZ) has called on the government not to enact a controversial new copyright provision, due to come into force on February 28. It says section 92A of the Copyright Amendment Act could see businesses lose their internet connections thanks to the actions of a single rogue employee.

'Third-rate legislation'
But despite the controversial legislation being widely regarded as the unfinest hour in a series of heroically unfine hours put in by outgoing Labour minister Judith Tizard, a spokesman for Attorney-General Christopher Finlayson's office says "a last minute stall won't happen". The government has no plans to overhaul the legislation. Instead, Mr Finlayson will focus on trying to make the legislation work.

While National supported the act's passage while in opposition, during an April 2008 parliamentary debate Mr Finlayson said his party's support was reluctant, saying  "I think this bill is very much a patch-up job and very much what I would call third-rate law reform legislation." (Read the Hansard transcript here.)

ISPANZ also notes that the select committee considering the original bill, which was chaired by Gerry Brownlee, rejected the section 92A approach but “the previous government reinserted the clauses in a last minute action, making New Zealand a guinea pig for experimental cyberlaw.

“If section 92A is allowed to come in, ISPs will have to disconnect organisations such as businesses, public libraries, government agencies etc as a result of accusations that an employee has used their computers for illegal downloading,” says ISPANZ president Jamie Baddeley. “Section 92A is poorly constructed law designed to force ISPs to cut off the internet access of those accused of repeat infringement of copyright.”

The new government still has a chance to take corrective action, and re-draw a bill more in line with the select committee’s original version.

Mr Finlayson's office says the minister is "not adverse to amending the legislation if people's fears do come true", but for now it is concentrating on how the act will work once up and running.

Warning first
Chapman Tripp senior solicitor Justin Graham confirms that the act fails to differentiate between individual accounts (home users) and internet accounts with multiple users (such as businesses).

But this flaw does not necessarily mean a business would necessarily lose its internet connection if an employee is accused of downloading illegal music or movies onto a company server.

The act calls on ISPs to create a termination policy. Mr Graham envisions that typically such a policy would involve an ISP sending a letter of warning to a company with a rogue employee who pirated copyrighted material.

If the company in question addressed the employee’s piracy, then the ISP could decide that appropriate action had been taken and drop the matter.

But that might not be the end of things: Mr Graham says the act still allows a copyright holder – such as a record or movie industry organisation – to take out an injunction against the company housing the rogue employee, and the company's ISP.

Test cases needed
However, it’s impossible to predict just how events could unfold once an accusation is made against a business. Mr Graham emphasises that the act’s extremely vague wording means a series of test cases would be needed to resolve the exact definition of “repeat infringing” and many other elements of the upcoming legislation – including what exactly constitutes an “internet service provider” (ISP). Mr Graham says under the act as it now stands, TradeMe could be considered as ISP.

Mr Graham also cautions that while large ISPs like Telecom Broadband (formerly Xtra), TelstraClear and Vodafone could be expected to formulate comprehensive termination policies, many smaller ISPs would be ill-equipped to deal with the new legislation.

ISPANZ agrees, noting that in Australia, where similar – and similarly controversial – legislation has already gone into force, smaller ISPs are bearing the brunt of complaints from copyright holders.

A further complication has been introduced in Australia with ISP iinet choosing to not terminate an accused pirate’s account but rather turn over details of his case to police. It is unclear whether the move is valid under the legislation, or whether police will take any action.

A bob each way
The act’s vague nature reflects the way it tries to reflect the contradictory interests of two camps, says Mr Graham: the freedom of information lobby, which believes all copyright material should be free of charge for fair use, and rights holders who see the digital world as an extension of the real-world copyright environment.

“The legislation puts a bob each way, with a nod to the rights holders, and a nod people who imbue the hacker ethic, ” Mr Graham says. Section 92A’s termination clauses are an example of the former, while the act’s liberal attitude to DVD zoning and password encryption – which can be bypassed for educational or research reasons – reflects the latter.

The resulting law, says ISPANZ’s Mr Baddeley, puts ISPs in a terrible position: “Under Section 92A We’ll be damned if we do and damned if we don't.

"We'll be faced with dealing with an accusation, not proven, of a copyright infringement and making a very difficult judgment call. If we decide in favour of our customers, we risk being sued by global media powerhouses. If we decide in favour of the rightsholder and disconnect a customer from the Internet, we risk being sued by customers for breach of contract. Disconnecting customers goes against everything we do."

Mr Baddeley notes support on this issue from every major ICT group in the country, including the Telecommunication Carriers’ Forum, The NZ Computer Society, The Telecommunications Users Association of New Zealand, InternetNZ, and others.

By contrast, the Recording Industry Association of New Zealand (RIANZ) and the Motion Picture Association’s NZFact lobby group have welcomed section 92A.

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18 Comments & Questions

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it will only end in tears.

as peoples Wifi's are hacked by them in the know, neighbour's stealing of neighbour's people being accused and convicted of something that a 12 Year Old done a block away using a cell phone and a ether net cable as a cheap and readily available Wifi Booster' and a port and packet sniffer in conjunction with a Mac Address changer to mask there Pc , :P this will make me go wired Networking From Now On.


Yup Thats ether gonna Kill the Laptop Pc market , or when the script kidies realise that Lap's R cool for hacking then there will be a resurgence in sales. either way the It sector is gonna be run off its feet.

Run Forest Run ... LOL


Is there anyone out there willing to fake a few takedown notices for government websites and websites of all political parties who support this bill? I don't believe there are any penalties for false complaints.


Let's not forget that the national archives has already engaged in vacuuming up all NZ websites, and are due to do it again after the legislation becomes active.
I would like to see what they do when they get sent genuine takedown notices for the copyrighted material they took without compensation to website owners.


I can see 25 wireless connections from my PC; if I was into hacking I'd have a field day using someone else's connection.
I run my router at 6% output to keep the signal inhouse and not down the street...


Ill-formed and ill conceived legislation is the hallmark and legacy left behind by Labour as they leave a trail of mess going out.

No one vote for them ever again!


Instead of an informed and researched decision, we're going to heap it all on the shoulders of one poor judge?


As far as I am aware you cannot send a take down notice for a govt website. That was one of the things they put in. I had thought that someone should do the airport website and the the buses and trains. maybe the herald and stuff and, god forbid, Maybe National's website and Labours too. But not the greens. they were the only ones against the whole farce.
Stupid Laws that cause ISP's to have to totally reorganize their helpdesk and cause a whole bunch of headaches should be reviewed by the public and the telecommunications sector first.
It will fail miserably because the ISPs are getting paid by these people. Why would they want to take them down. I would think they will have to direct them to a website that teaches them to hide where the traffic is going so they can plead ignorance and leave their customers in peace.


this will never work i will tell u now and im glad ive got ethernet cables. im probably gonna get taking off by my isp because i watch alot of youtube like 3g a day or something like tht


Enable encryption in Utorrent. Read FAQs, question authority and news sources. Beat them with the tech they are trying to stop :)

This law will not work.. it is too easy to access the internet via wifi and other methods without permission.

We need to protest this.


Is this going to stuff up the economy even further how much will this cost isps to enforce.


Come On National POLITICIANS Scrap a totally FLAWED LAW.... Total Disgrace that it has gone so far down the track, poorly though out and going to be a COSTLY nightmare.


the goverment should throw ths crap out how are they policing it? watching for multiple connections ? targeting the big downloaders?


Just encrypt your sends, 128 encription is free- easy to install and only you and the sender will have any idea what your sending- Then jam them- Nobody can open an encrypted anything if it dosent have any password. A few hundred thousand encrypted boxes will keep them busy for years. Come on New Zealand - dont just complain fight!!!


I am confident that this kind of copyright law will take new shapes until the online copyright issue will be covered, this is just the beginning and this is the right thing to do, otherwise we won't have many valuable things on the internet to choose from...
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This is pathetic. You mean to tell me that one employee can affect the whole company? What if my son does something nefarious with his <a href="">video games</a>, and I could lose my internet service? This is outrageous.


This is an interesting move, I wonder what really sparked such a call.

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