Ministerial discretion on copyright safe harbour could stifle investment

Stuart Corner
Sunday, 13 November 2011 10:15

IT Policy - Regulation

A proposal to give the minister power to withhold, at his or her discretion, the safe harbour protection provided by the Copyright Act would stifle innovation and investment, and should not be adopted, according to Ericsson.

The proposal is contained in a recently issued consultation paper on the scheme. It suggests that the scheme should cover "A person who provides services relating to, or provides connections for, the transmission or routing of data; or operates facilities for, online services or network access, but does not include such person or class of persons as the Minister may prescribe in the Regulations." (our italics)

The current safe harbour provisions are designed to cover ISPs and telco service providers. The paper canvasses extending these to other providers of network access such as educational institutions, work places, or online services such as search engines.

In its submission to the paper, Ericsson argues that: "A key policy rationale for expanding the application of the safe harbours is to encourage innovation, investment in and adoption of ICT technologies and to stimulate the growth of lawful digital content services in Australia's digital economy."

It says that the review "needs to minimise the risk of low predictability (ie decreasing investor confidence)...It is a necessary part of any business case analysis for a company contemplating the establishment of services in Australia (whether as a start up deciding whether to commence operations or an established company deciding whether to expand operations) to evaluate the potential legal risks and operational uncertainties of doing business in-country.

"The absence of a robust and certain safe harbour scheme for online service providers is a serious potential risk factor - potentially making Australia a less attractive venue to set up business."

Ericsson suggest that this risk is increased because the proposed ministerial power is out of step with the majority of comparable jurisdictions and it names the United States, European Union Directive, New Zealand, Canada (proposal), Japan, United Kingdom and India. It claims that only Singapore and Korea's safe harbour rules contain the ability to exclude certain persons.

Ericsson has called on the Australian government to "introduce a 'best practice' safe harbour regime which provides maximum certainty for service providers and which aims to place Australia in the most attractive position possible in terms of advancing the Australian digital economy."