New Zealand passes 'three-strikes' law

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More requirements for businesses and ISPs?

The New Zealand Parliament has passed a Copyright and Infringing File Sharing Bill that could see persistent copyright infringers disconnected from the internet for up to six months.

Under the new law, rights holders could pay a processing fee to send infringement notices to alleged copyright infringers via their internet service providers.

If those internet users were found to continue to breach copyright, rights holders could bring them before a newly established Copyright Tribunal staffed by five intellectual property lawyers.

Infringement notices were presumed to be correct and valid, so it would then be up to accused users to prove their innocence. Those found guilty of infringement faced fines of up to NZ$15,000 ($11,300).

The bill also included a power for district courts to order ISPs to disconnect customers for up to six months should the three-notice process and remedies by the Copyright Tribunal be deemed ineffective.

Intellectual Property lawyer Rick Shera of Lowndes Jordan in Auckland noted that the new Act did not specify a timeframe for the disconnection clause to be activated.

The entire new law may also be applied to mobile providers in two years’ time, after a government review.

Presumption of guilt could burden businesses, ISPs

According to Matthew Holloway of artists lobby group Creative Freedom Foundation, the New Zealand Parliament had not studied compliance costs for businesses.

Citing estimates from NZ internet provider association ISPANZ, Holloway said 90 percent of the country’s businesses use NAT to connect their employees to the internet.

NAT devices -- like most home phones -- are incapable of tracking individual users, which is a practical necessity of the law, he said.

"Proving you didn't infringe does involve tracking all network traffic," Holloway explained, adding that NAT devices capable of tracking traffic for copyright monitoring purposes cost in excess of NZ$1,500.

Telecommunications Users Association of New Zealand chief executive Paul Brislen said the new law may require organisations to redraft employment contracts so they could monitor traffic such as email and web browsing for copyright infringement.

Brislen also asked if ISPs would be required to track repeat infringers to prevent them from signing up with new providers after being disconnected.

"How does that leave, for instance, annual contracts that stipulate early disconnection fees? The new law leaves us with more questions than answers," he said.

Brislen speculated that the new law may in fact encourage ISPs to disconnect users upon receiving infringement notices, despite there being no requirement to do so currently.

"I’ve been told by major providers that this is a likely scenario, as they don’t want to take risks and dispute the infringement notices," he said.

According to Pirate Party of Australia acting secretary Simon Frew, the presumption of guilt was a "flagrant assault on the legal right to be assumed innocent until proven guilty".

Frew warned that the new law may unduly punish individuals living in share houses or large families, since one person's copyright infringement would affect everyone in the household.

"Anyone could be disconnected at the request of the media industry. This is something that could easily be abused and many innocent people disconnected," Frew said.

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