Three strikes proposed for Australia’s anti-piracy code

A three-strikes warning scheme for Australian-based copyright infringers is a keystone proposal in a voluntary code developed by Australia’s ISPs and copyright holders to combat online piracy and illegal downloading of music, movies and TV shows.

The draft Copyright Notice Scheme industry code was thrashed out by the two sectors last Friday – after years of deadlocked, often hostile, negotiations – to meet a deadline imposed by the Federal Government. The Government threatened to otherwise apply its own regulations, which suggested siding with copyright holders (seeing illegal downloading as theft) and with harsher penalties.

The three-strikes approach had long been touted by the Attorney-General's Department and Minister for Communications Michael Turnbull as a viable option to the problem. Rights holders, of course, applauded the sentiment. ISPs had rejected it as “heavy handed”.

The code’s gradual response means that the infringer (or account holder) can cease their illegal activities or challenge the accusation within 28 days of receiving a final notice. A challenge will cost a $25 fee to be handled by an Adjudication Panel. If the appeal is successful, the $25 will be returned.

The code, set to go live on September 1, was published by the Communications Alliance, which represents the telecommunications sector.

It is for "residential fixed, internet account holders only.” It reads, "This copyright notice scheme provides that, at the instigation of rights holders, ISPs must, where possible, issue Education, Warning or Final Notices to relevant account holders.” All three steps must be done within 14 days and within the same year, or it reverts to zero.

It’s only after the third stage that rights holders can access the user’s personal data. They can then apply through the Federal Court to obtain it from the ISP.

The ISPs must “reasonably” help, and cooperate with, the rights holder if the case heads to court. ISPs can no longer use protection of its customers or its view that the system is flawed, as a defence not to cooperate. If the court issues an order, the ISP has to comply.

The draft code does not address two important issues that were stumbling blocks in earlier negotiations.

Firstly, who pays for the policing and warnings issue? This is vital if costs are passed on to consumers, which would affect lower-income households. According to the Australian Bureau of Statistics, 83% of Australian households have internet access. But that falls to 57% for households with an income less than $40,000 per year.

Secondly, what sanctions specifically would be applied? And how would they affect the right of a consumer to use the internet for a wide range of interests including education and career?

The code is open for public discussion until March 23 via the Communications Alliance website. It then goes to the Australian Communications and Media Authority to ratify. It will be re-evaluated in 18 months, and after that, every five years. However the draft acknowledges that with technology moving so quickly, a review might have to be done before the end of the five-year period.

The code would be administered by the Copyright Information Panel. It will have five members – two representing ISPs, two from rights holders, and one from the Australian Communications Consumer Action Network (ACCAN).

ACCAN has been involved in discussions from the start. On behalf of consumers, it maintained that penalties for illegal downloading must not impact on a consumer’s right to use the internet for other essential activities. It also expressed concern that evidence gathered through the code would allow rights holders to use courts to disconnect consumers.

Last Friday ACCAN CEO Teresa Corbin stated, "Disconnection from the internet or speed throttling are not proportionate methods to tackle the problem of online copyright infringement. Negotiations are still underway on key aspects of the Code and ACCAN will continue to engage to get a fair result for consumers."

ACCAN cites overseas evidence that copyright infringement is not a problem if consumers have access to affordable legitimate content. In America it dropped five-fold after Netflix and others arrived in that market. Corbin said, "We believe that if the Australian streaming market is allowed to mature it would reduce the need for costly regulation."

John Stanton, CEO OF Communication Alliance CEO, acknowledged that while ISPs and rights holders were agreed on eradicating online copyright infringement, “These issues are complex […] and it has proved very difficult in the past […] to agree on the shape of a notice scheme. Much work remains, but publication of a draft Code is an important milestone toward greater protection for the legitimate rights of the creative industries.”