Thanks to an impressive campaign spearheaded by Creative Freedom NZ, New Zealand's controversial 'guilt upon accusation' clause, s 92A, will be delayed and may be suspended and may be abandoned.

Section 92A is a graduated response provision that requires ISPs to “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.”

Unfortunately, the definition of 'repeat infringer' is not clearly defined. The provision states that “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 wording is familiar - it is almost word for word identical to the Australian limitation on safe harbours in s 116AH, which provides that “The carriage service provider must adopt and reasonably implement a policy that provides for termination, in appropriate circumstances, of the accounts of repeat infringers.”

There has been an incredible showing of online protest at the forthcoming introduction of s 92 in New Zealand, and a lot of international support. We at EFA are heartened by the change that New Zealanders have been able to achieve. This is a notable victory for users, and is very encouraging for similar action worldwide.

Section 92 hasn't been repealed yet, however. The next step for New Zealand is to agree on a code of practice for the large ISPs. TCF have released a draft code of practice with some guidelines as to how ISPs should interpret the legislation.

10. To establish any Infringement, the Copyright Holder must provide a Party with evidence that that Party considers, in its sole discretion, would be sufficient to satisfy a Court that an Infringement under the Act has taken place.

11. Examples of evidence which would be sufficient include:

11.1 a judgement of a Court (interim or final) finding Infringement under the Act;

11.2 a Copyright Holder Notice which complies with this Code;

11.3 such other evidence as that Party is prepared, in its sole discretion, to accept would be sufficient to satisfy a Court that an Infringement under the Act has taken place.

The draft guidelines establish a three-strikes regime, with 'strikes' expiring after 18 months. If a user receives three 'education notices' in different months within a year and a half, a final warning is to be sent, and the account terminated within 48 hours.

Under the draft code, the user has a right of reply within three months of being served with a warning. As written, the guidelines appear to provide no mechanism for adjudicating on whether a user's 'counter-notice' is valid or not. This is, of course, understandable - an ISP is not a court of law or an otherwise competent trier of fact, and does not have either the resources, the training, or the procedural framework in place to determine whether a copyright infringement claim has been correctly made out and whether a defence has been correctly raised and made out. The effect, however, is that the termination provisions are practically useless - termination under the guidelines is only possible upon receipt of three uncontested warnings. If users are careful to contest each warning - effectively, legitimately putting the copyright holder to proof - then disconnection is no longer possible under the code.

Remember, this is a draft code, and such a construction is likely to be criticised by copyright lobbyists. But it raises a very real question for policy makers. If we are going to terminate accounts upon suspicion of copyright infringement, we have to ask ourselves what level of due process we are willing to sacrifice. If we decide that due process is important to us, that households ought not be disconnected without a right of reply and a decision from a competent trier of law and fact, then the graduated response scheme is overly complicated, costly, and ineffective.

The only realistic way to make a graduated response scheme effective would be to do away with due process. It would require entrusting ISPs to make decisions about whether three separate infringements have in fact taken place. In reality this means that risk averse ISPs will be likely to agree with the copyright owner, because the costs and difficulties of investigating the claims will be higher than their potential liability for wrongly disconnecting users. (We could impose liability for wrongful disconnections on the ISPs, but that really just exacerbates their delicate situation - not being competent to evaluate questions of law and fact, they will be liable from either copyright owners or users for nearly all of their decisions.)

I don't think we're prepared to accept a situation where there is no due process. The dangers are too high. The internet is far too important a tool for communication to be held to ransom by copyright owners for the alleged infringement of private rights.

So this leaves us in an interesting position. Is there any compromise we could reach that would allow us to be comfortable with the risk to users? I'm not convinced that there is a workable graduated response system. Fundamentally, this is about lowering enforcement costs by removing copyright infringement proceedings from the courts. But every time you remove copyright infringement from the judicial system, you lose the safeguards that have been developed over centuries that we now take for granted - the right to confront an accuser, the burden of proof resting with the party alleging infringement, the evidentiary rules that ensure fair trials, the impartiality of the judiciary, the openness of legal process. Without those safeguards, of course enforcement costs will be lower - but so too will confidence in the system and security of individual rights under law.

I think we need to start looking for other solutions. Copyright taxes are an interesting idea that we don't talk about enough, for example. And of course, there's always the possibility that the copyright lobby will realise that there are still plenty of ways to make money by giving users what they want, rather than seeking more aggressive, costly, inefficient, and unworkable legislative changes.

The delay in the NZ law is a good sign, but there are still many more problems. The current case before the Federal Court between AFACT and iiNet will examine what responsibility ISPs have under Australian law, which already includes a provision requiring termination of repeat infringers. The upcoming ACTA negotiations, though delayed by the change in US administration, may see a wider adoption of graduated response mechanisms. We need to be critical here, and determine exactly what we are prepared to sacrifice in order to lower copyright enforcement costs. If we decide that we're not prepared to sacrifice either due process or the right to read and communicate on the internet, then there is still a lot of work ahead.

[ cross posted to Nic's blog ]