ISP ‘safe harbor’ loopholes panned

Criticism has been leveled at the “Internet Service Provider Liability Limitation” amendments to Taiwan’s Copyright Act that came into effect in May 2009. The amendments resemble the ISP liability limitation regime set out in the 1998 US Digital Millennium Copyright Act (DMCA) Title II and provide for a notice-takedown-counter notice mechanism as well as a controversial “three strikes” rule whereby alleged offenders face termination of services in whole or in part.

The amendments have been justified as necessary to reduce online copyright infringement in Taiwan while setting limitations on the liability of an ISP for acts of infringement committed by users. To avail themselves of the “safe harbor” protections from civil and criminal liability, ISPs must remove or disable allegedly infringing material upon notification from a rights holder. ISPs, however, need not make a substantive determination as to whether the activity cited in a notification constitutes infringement.

Although the amendments to the Act include mechanisms to discourage the sending of false notifications, concerns remain that an ISP may be compelled to remove material or terminate user access on the basis of an allegation of infringement. Individual users of connection services do not even have the option of providing a counter-notification in the event that the ISP warns the user that a notice has been received. Receipt of three notices should lead to the termination of a user’s access to the internet by the ISP in whole or in part. An individual user’s only real recourse would be to take legal action against party issuing the notice(s).

ISPs have raised concerns over the potential effect on commercial operations and their goodwill with their customers if required to throttle or suspend internet services based only on an allegation of infringement. Concerns have also been raised over accurately identifying infringing users for the ‘three strike rule’ given the widespread use of non-fixed/dynamic ip addresses as well as regarding how to actually determine the number of alleged infringements as little guidance has so far been provided and the supporting regulations not yet drafted.

The counter-notification procedure under the amendments has also been subject to a host of criticisms. First, a deadline for issuing a counter-notification has not been specified in the amendments. This could allow a user to delay sending the counter-notification long enough to affect the rights holder’s ability to take effective action. Secondly, ISPs have also raised concerns as removed content or other records may not be available in cases where a user waits months before submitting a counter-notification, potentially resulting in the loss of “safe harbor” protection for the ISP. Third, the counter-notification mechanism requires the ISP, upon receipt of a counter-notification, to forward it to the copyright holder. This has raised privacy concerns over the disclosure of a user’s personal information to rights holders.

Industry groups have also requested that the time limit for ISPs to alert rights holders of notifications not complying with the law be reduced from seven to three days. ISPs, however, contend that this is not feasible given the increased burdens that the amendments already impose on ISP resources.

The Taiwan Intellectual Property Office (TIPO) will hold public hearings in the near future to address the concerns of the various affected parties. The TIPO will also be draft the supporting regulations detailing the implementation of the amendments.

Earlier this year, the U.S. removed Taiwan from its USTR Special 301 Watchlist of countries cited for failure to adequately protect intellectual property rights. The removal from the list was based in part on Taiwan’s implementation of a special IPR Court, earlier passage of anti-P2P amendments to the Copyright Act, and the passage of the current ISP liability amendments.

A version of this article appears in the Computer Law and Security Review. For more information about this topic, please contact K. Mark Brown.

Written August 13, 2009 By K. Mark Brown.