On the Gripping Hand

Effectively, it’s dead as a means of managing the Act. The TCF’s rules are pretty clear:

9.1.6 A unanimous vote will be required for:

(a) changes to the Rules of Association;
(b) setting the fees and budget for the Forum and the use of the
Forum’s budget for carrying out any studies, consultancies or
use of external expert advisors;

(c) the endorsement of any non-regulated telecommunications
codes ;

(d) the continuation of any work stream that is subject to a
reporting requirement imposed on a Working Party by the
Board under Rule 7.1.11;
(e) Any extension beyond three months for any reporting back
timeframe referred to in Rule 7.1.11 or waiving the
requirement for a Working Party to provide the report
referred to in Rule 7.1.11;
(f) Subject to Rule 12.1.2, determining public positions and
public statements of the Forum;
(g) appointment of the Forum Administrator;
(h) changes to the documented operating procedures (“Hand
Book”);
(i) appointment of the Board’s Chairperson;

(j) Forum consultation with the public and interested parties on
draft non-regulated telecommunications codes;

(k) establishment of sub-committees of the Board referred to in
section 4.8 of the Handbook;

Plus, the withdrawal of the second largest (read “other”) telco, and a major ISP, would make a nonsense of its implementation, even if only a majority vote was needed. While some ISPs will take a while to show their hand (I understand off-line, that Orcon are “still evaluating our position, to see if there’s a workable solution.”), I expect to see some others follow suit quick smart. I’d guess none of the smaller players wanted to be the first to jump, as that would likely subject them to accusations from the likes of APRA and RIANZ that they were “soft on copyright theft”, but there’s safety in numbers.

TelstraClear’s letter is very clear on their reasoning and worth posting in full:

SUBMISSIONS ON DRAFT COPYRIGHT CODE OF PRACTICE

1. On behalf of TelstraClear, I wish to thank the TCF Copyright Working Party for the opportunity to make submissions on the draft Internet Service Provider Copyright Code of Practice.

2. TelstraClear has been represented on the Working Party, and has taken an active interest in the proposal to develop a Code. However, having fully considered the issues and also having taken account of widespread public concern on the topic, TelstraClear is of the view that it is inappropriate for the TCF to adopt such a code. The reasons for this are set out below.

The law
3. 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 particular:

a) The terms “appropriate circumstances” and “repeat infringer” are far too vague;

b) There are no safe harbour provisions for ISPs, which contrasts with similar legislation in other jurisdictions;

c) The term “Internet Service Provider” is defined so broadly that the law impacts a broad range of businesses and public facilities. Many of those entities will be unaware that the law applies to them;

d) Though the law requires a “policy” there is no guidance on what that must contain; and

e) There are no restrictions on re-connection, which means that any disconnections under the Act are unlikely to achieve any purpose.

4. In TelstraClear’s view, any industry code would simple 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 section 92A was repealed. Failing that, it should be amended to address the above concerns.

The Code
5. TelstraClear acknowledges the effort that has gone in to producing the draft code. At the end of the day though, a code is not required by, or even contemplated by, the relevant legislation. However a TCF code would set a benchmark which will have relevance to all ISPs, whether or not they were party to it. Since the term “ISP” is given wide meaning in the Act, the TCF, by adopting a code, would be acting in a manner which impacted on the legal positions of TCF members and non-members alike. This is an outcome to which TelstraClear has concluded that it is not willing to be a party.

6. It is important to note here that internet users (our customers) have protested considerably against the Act and its implementation. Businesses also have serious and justifiable concerns on how this will impact them. Implementation of the proposed code would in our view make the legal position worse rather than better for our customers. Accordingly, TelstraClear will not be supporting the proposed code.

7. Given this position, we do not wish to comment on the proposed code in any detail. However at a high level TelstraClear has the following concerns:

a) it requires ISPs to accept allegations as sufficient proof of infringement, provided the ISP can judge that the allegation is of a certain quality, or, for pre-approved rights holders, is in the right form. This reversal of the burden of proof is not mandated by the legislation for inclusion in any policy. It would require ISPs to act, in some circumstances, as judges, which is inappropriate. It also appears to set the bar for disconnection significantly lower than the legislation would require, which is not in the interests of consumers.

b) the code carries with it an unreasonably high administrative burden, including short time frames. This requires considerable resourcing with as yet unknown costs, which will vary from ISP to ISP. TelstraClear currently receives 1,000 equivalent type notices a month from overseas organisations and this number is likely to increase when s92A is brought into effect. Dealing with these notices will be time- consuming and expensive. To address this cost recovery should be on a case by case basis and system generated notices should be excluded.

c) downstream ISPs’ contact details can be disclosed to preapproved rights holders as a matter of practice. Since this could include information about almost any business customer, TelstraClear is extremely concerned about confidential customer information being provided to third parties in the absence of a specific legislative requirement.

Conclusion
8. The public consultation and debate that has resulted from the TCF’s decision to investigate the development of a code has been invaluable. However it is now clear following that debate that the proposed code would have an impact beyond TCF’s members and their businesses.

9. The TCF was set up to work primarily on issues exclusive to telecommunications carriers, not the highly controversial area of copyright enforcement. It is perhaps unfortunate that the possibility of the TCF developing a code has taken on more significance than is, in TelstraClear’s view, warranted. As previously stated, the legislation does not contemplate any such code and at the end of the day the TCF does not represent ISPs – either in the usual sense of the term, or in the wider way that the term is defined in the Act.

10. Finally, it should be noted that in other jurisdictions with similar legislation there are no industry codes and each ISP has its own policy. TelstraClear does not see any benefit to the New Zealand public in adopting a different approach. Given the problems inherent in the law, the feedback from customers and internet users and the fact that the Code would impact a broad range of businesses and organisations that are not associated with the TCF, TelstraClear does not support the adoption of a Code by the TCF.

Yours sincerely

Mark Aspden
General Counsel

OCR by www.OnlineOCR.net

Bad law + not our job anyway = We’re out of here

Ralph Chivers was trying to but a brave face on it yesterday:

Ralph Chivers, CEO of the TCF, says as a result of TelstraClear’s move, the TCF will not be able to complete an endorsed code. For a measure to be approved, members have to vote in favour of it or abstain, he explains.

However, Chivers says the working party will continue developing the document.

“There is still a significant majority of members in favour of continuing the work,” he says. People will be able to use the document “as they see fit”.

but it’s very academic without TelstraClear. By the way, if you looked at that Computerworld posting yesterday, have another look as it has been updated to include comment from InternetNZ and TUANZ.

This could actually be good for the TCF, as everyone and his dog has been passing the buck to them for anything that even remotely touches telecommunications. If they learn from this and stick to their last, they can be a very valuable organisation. But cops and judges, they ain’t, and all power to TelstraClear for taking such a principled stand.

Disclosure: I am a TelstraClear customer, and damn proud to be one, right at this moment.