The first few issued notices are starting to leak out and it appears that they do not comply.

An Orcon user posted to the 3strikes forum copies of the notices they received. Comparing the information provided on those notices to the law and regulations, we noted the following problems:

• There is no description of the type of work as per 14(1) of the Copyright Act. (Regulations 4(2)c(iii).)
• The nature of the breach (as described by 15(1) of the Copyright Act) is not specified. (Regulations 4(2)c(iv).) The notice only says a breach has taken place, not the nature of it.
• The date and time given on the first notice is not specified to the second. (Regulations, 4(2)c(v).)
• The file sharing application or network is not specified. (Regulations, 4(2)c(vi).)
• The notice number does not include information that identifies the type of notice or the IPAP that sent it. (Regulations 5(2)(b) & (c).)

These details matter because the account holder needs to understand what they are accused of so that they can properly defend themselves.

Account suspension

We are also deeply concerned that the notice makes the claim that your Internet connection can be suspended by the District Court for up to six months. This part of the law has not yet been activated, and it is alarming that notices are already misleading users on possible penalties. Orcon should not be making such claims.

Concluding questions

The notices as posted do not comply with the requirements of the law and regulations.

Does this mean that they are invalid and can be challenged (or ignored) as such?

Will the Copyright Tribunal accept them as valid or not?

Does this mean that all notices sent through Orcon are invalid?

The text of the Act defines "file sharing" in Section 122A(1) as:

file sharing is where—

• “(a) material is uploaded via, or downloaded from, the Internet using an application or network that enables the simultaneous sharing of material between multiple users; and

• “(b) uploading and downloading may, but need not, occur at the same time

Much of the Internet is designed in a way that content is simultaneously shared between multiple users, so does the new law apply only to peer to peer (P2P) filesharing or does it apply to any kind of sharing of content between people?

MED's Answer

InternetNZ put this question to the Ministry of Economic Development who responded that by their interpretation it only covers P2P sharing. While this is useful, the view of the MED is not the only one taken into account by the courts.

Parliament

Hansard, the official record of Parliament, is also used as a reference when courts need to understand the intent of a piece of legislation. The question of what is included was asked during the debate for the second reading of the bill:

JACINDA ARDERN: I would like to request the Minister, given that Hansard will be used as a record going forward in the way that this billis applied in practical terms, to give the Committee his view of the definition of “file sharing”, how he sees that definition being applied once this legislation is enacted and becomes law. For instance, does he believe that it includes an attachment to an email? How far does his view of this definition go? I think clarification from the Ministerwould be helpful for this debate.

Speaking for the Government, Hon Dr Nick Smith replied:

Hon Dr NICK SMITH (Minister for the Environment): I will also respond to the question from Jacinda Ardern about where in this bill the definition of file sharing is. It is quite simply set out in clause 7 of Part 1. That clause sets out quite clearly the definition of file sharing, and I further say that, yes, that definition does include an attachment that involves the sharing of files.

This appears to clearly state that the definition is not solely limited to P2P networks, but covers any method of sharing files, whether that be streaming, email, private or public locker sites, or any other method yet to be discovered.

Select Committee

Rick Shera has helpfully pointed out the following from the Select Committee's report:

We recommend that the definition of file sharing in section 122A(1) be amended by including reference to downloading or uploading material using networks or applications that allow material to be shared among multiple users. This would avoid inadvertently capturing activities such as emailing or downloading that did not involve file sharing; if such activities breached copyright, they would be actionable under existing provisions in the Copyright Act.

Conclusion

With MED believing one thing and the politicians who passed the law believing another, what is the truth of the matter? The answer is that we cannot know until it is tested in court (or clarified by a law change).

Our submission argues that ISPs are being increasingly put into a difficult position of escalating compliance costs imposed by regulations such as this, while having a very limited ability to prevent the behaviour creating those costs. We believe ISPs should not be involved in any way shape or form in determining what end users can and cannot do with the Internet.

The submission also addresses the re-opening of debate around the division of costs, as the discussion document has again raised the possibility that ISPs will bear significant setup and on-going costs in handling these notices. We also note that information provided to those being accused of infringing copyright should be full and complete, and sufficient to assist account holders in identifying the root source of the claim of infringement.

Full submission: Tech Liberty Submission on Copyright Infringing Filesharing Act Regulations [PDF].

While many have made the comparison to traffic tickets (where guilt is assumed but can be challenged), we pointed out in an earlier article why this is unreasonable, with Police and media companies being held to very different standards of behaviour.

The law, to be passed under urgency today, has been modified but how much difference does this make? Compare the two versions:

The original

122MA Infringement notice as evidence of copyright infringement

(1) In proceedings before the Tribunal, an infringement notice is conclusive evidence of the following:
(a) that each incidence of file sharing identified in the notice constituted an infringement of the right owner's copyright in the work identified:
(b) that the information recorded in the infringement notice is correct:
(c) that the infringement notice was issued in accordance with this Act.
(2) An account holder may submit evidence, or give reasons, that show that any 1 or more of the presumptions in subsection (1) do not apply with respect to any particular infringement identified in an infringement notice.
(3) If an account holder submits evidence or gives reasons as referred to in subsection (2), the rights owner must satisfy the Tribunal that the particular presumption or presumptions are correct.

The version as modified by the Supplementary Order Paper

122MA Infringement notice as evidence of copyright infringement
(1) In proceedings before the Tribunal, in relation to an infringement notice, it is presumed:
(a) that each incidence of file sharing identified in the notice constituted an infringement of the right owner's copyright in the work identified;
(b) that the information recorded in the infringement notice is correct;
(c) that the infringement notice was issued in accordance with this Act.
(2) An account holder may submit evidence that, or give reasons why, any 1 or more of the presumptions in subsection (1) do not apply with respect to any particular infringement identified in an infringement notice.
(3) If an account holder submits evidence or gives reasons as referred to in subsection (2), the rights owner must satisfy the Tribunal that, in relation to the relevant infringement or notice, the particular presumption or presumptions are correct.

What do these changes mean?

While the accusation of the rights holder was originally "conclusive evidence", it is now merely "presumed" to be correct. This seems to be a semantic quibble rather than a serious change.

The account holder will still only be able to challenge the accusations by giving evidence or having reasons. It is obvious that this will have to be more than just a straight "I didn't do it" denial. Proving that you didn't do something will not be easy and reverses one of the basic principles of our legal system, that the accuser has to prove their case.

We already know that rights holders get their accusations wrong time and time again, so the idea that our law will legislate their correctness is deeply disturbing.

Computers aren't people

Furthermore, there is a serious flaw in the assumption that all computer-related law is based on: the actions of a computer are always the actions of the owner of the machine. This law goes even further, making the person or company who pays for the internet account responsible for the actions of every person and computer that uses that account.

Anyone who has seen the effect of viruses, trojans, social engineering, drive-by downloads, and other attacks on users of the Internet would be hard pressed to say, with absolute certainty, than the data leaving and entering your computer could only happen as a result of your deliberate actions. It's not even true you can claim that you have knowledge of every file - how many people actually know the contents of every single file on the laptop?

This law, to be passed under urgency today, still has this exact same problem. Despite the lack of any provable link between a person and a computer, or a person and an internet account, we will still be assuming that the account holder is liable. And section 122MA means that they will be liable even if the accusations against them are faulty or not sufficiently proven.

Conclusion

So, what does this mean for the average person?

1. The person who is listed as the owner of your internet account will be responsible for the actions of everyone who uses that account.
2. If a content company accuses someone, the tribunal will accept that accusation as true unless the account holder can prove that the accusation is false. This reverses the normal burden of proof.

And, when the suspension of internet accounts is lifted (the provision is included but 'on hold'), if you can't prove your innocence your internet will be cut off, something we find totally unacceptable.

A thread over on gpforums.co.nz has discussed problems Telecom users have had accessing content delivered by various CDNs (content delivery networks - used by many sites to handle video streaming).

Network traces showed a large amount of packet loss and the path taken by the data looked a bit unusual.

This appears to be the first sign of a site being either adversely affected or actually blocked by the DIA filter. We've also had confirmation of other ISPs (Internet service providers) believed to be using the filter having access blocked.

What we believe is happening

The filter works by creating alternative routes to particular network IP addresses and passing them onto the participating ISPs. Traffic to those IP addresses is then passed to the DIA and checked by the filter to see whether it is going to the blocked site or another site on the same IP address. If it is going to a blocked site, the user is redirected to www.dce.net.nz, or else it allowed through the DIA's ISP and out onto the Internet. (Read more in our Filtering Frequently Asked Questions article.)

Inspection of the traces shows that the traffic is going through an ISP with a relationship with the Department. The address 124.150.165.62 in the traces is from that ISP. The traffic is then going out through a link that the ISP has to Australia.

This ISP's link to the Internet appears to be either under considerable pressure or is simply broken. The level of traffic being dropped by it (as reported by users and our own investigation) is likely to be degrading access significantly to any site hosted - but not actually blocked - by any IP address the DIA is wanting to inspect.

What does this mean?

The site in question hosts anime (animated video from Japan and other countries). While we believe that some anime work has been found objectionable in New Zealand, we cannot find any reference to this site being banned by the Chief Censor.

Even if one video at the site has been blocked by the DIA, this blocking appears to be generally degrading performance to other material on that site or any other site hosted by the same content delivery network.

The Department has repeatedly denied access to the filter list in the expectation that hiding the list will prevent people from accessing it. As this story illustrates, it's not difficult to uncover the filter given the effects it has on an IP address being filtered/intercepted.

We're very interested in hearing from anyone else having difficulties accessing a site where 124.150.165.62 appears in a traceroute to the site. We're particularly interested in legal content being degraded by passing through the DIA's filter.

What this hid from view was that if you weren't an IPAP, then you must be an account holder. And, as an account holder, you became liable for everything done through that account. In fact, it's easier to think about the implications of the bill this way:

Whoever is named as holding the last publically identifable address is liable for all infringement attributed to that address.

You can only escape this liability (and become an IPAP with all of their obligations) if you meet all of the following tests:

1. Provide any form of digital communications to someone else
2. Allocate an IP address to that person or organisation
3. Bill the person or organisation
4. Are primarily in the business of providing such services
5. Are providing your services to fixed users on a continual basis, not on a transient basis

Approaching it from this point of view makes it easier to see what obligations and exposures you have.

Who is liable?

A public library providing Internet access terminals fails to meet points 4 and 5. This means they are liable for all infringement by anyone who uses their terminals.

An airport that provides free wireless Internet access to passing travellers fails to meet points 3, 4 and 5. They are liable for any copyright infringement by anyone passing through the terminal using their wifi.

I have a server from a hosting provider to that I pay for. Since the hosting providers meets all of points 1 through 5, they have the obligations of an IPAP, and must forward notices to me. I am liable for any infringement made through my server, for example, after the server is hacked into and software installed on it without my knowledge.

If you share an internet connection with your flatmates and your name in on the account? You don't meet point 4, so you are liable for any infringement by your flatmates.

As the law is currently written, can any business or person risk giving Internet access to someone else?

Some have interpreted this to mean guilt on accusation has made a return back into the bill, after S92A was suspended and finally defeated for doing the exact same thing. In response, it is claimed that this does not re-introduce guilt on accusation, but instead is based on the traffic ticket model, where guilt is presumed unless they are contested.

But traffic tickets are quite different to the claims made by media companies.

• Traffic tickets are issued by sworn police officers, or by automated systems that are held to rigorous standards. Media companies and their notice sending robots are not held to the same standards and have no statutory obligations or penalities for wrongful claims. The industry has resisted attempts to inspect their automated systems.
• Police are subject to oversight by their superiors, the Independent Police Complaints Authority and ultimately parliament and the public. They have a responsiblity to be impartial and to act in the public good. Media companies and their agents have no oversight at all and act purely in the interest of their own profits.
• Tickets issued by officers are unlikely to identify the wrong person, while automated systems have a number of checks and balances to ensure that only solid and provable tickets are issued. Media companies have already engaged in carpet-bombing users with claims that cannot be substantiated, and they rely on ISPs to always identify the correct account holder.

Google noted in their submission on S92A that 37% of the notices received under the DMCA were unable to be substantiated as valid copyright claims, and a whopping 57% were businesses targeting their rivals. Judge David Harvey noted in his submission on S92A that 30% of the copyright claims being heard in New Zealand failed to even establish a rightful copyright claim. Considering this error rate, surely we can't be proposing to accept untested claims from media companies as conclusive evidence?

We believe that 122MA is trying to allow the Copyright Tribunal to make rulings based "on the papers" where there is no contest being made about the claims. But rather than following a traffic ticket model - making any claim made by a media company conclusive proof - we believe the Tribunal already has sufficient scope and experience to make that determination itself. This is similar to how the Disputes Tribunal works and is a sensible model for handling copyright infringement claims.

Section 122MA should be removed in its entirety.

Original article follows:

There's a new ACTA draft leak out, thanks to La Quardature. And does it contain a shocker when comparing the new and last leaked texts.

January 2010 Draft Text

In the Leaked January 2010 draft appearing above, New Zealand position on statutory damages (i.e. made up numbers like in the US where you face US$175,000 per infringement for each US$0.99 song) was fairly clear - we don't have such a damages system anywhere in our laws, and wouldn't accept one here. That is shown by notes proposing it's removal, and watering down the paragraph to "may" implement.

July 2010 Draft Text

Now looking at the post-Lucerne leaked text, any objection by New Zealand is gone. The "may" which would allow us to avoid implementing statutory damages is replaced with an unqualified "shall".

Did we just concede statutory damages?

Do claims by MFAT and MED that "no law changes are required" now stack up with the leaked text?

Is the New Zealand position now all in favor of monetizing justice?

The TPP is an existing free trade agreement (FTA) between NZ, Singapore, Brunei and Chile signed in 2005. The TPP allows for more countries to join and the USA, Australia, Vietnam and Peru have all indicated that they are interested. Substantive negotiations began in March.

Of course, the USA has proceeded to reframe the agreement around its usual default template for any FTA - draconian IP protection on behalf of its content industries and limited concessions in all other areas, creating a one-sided arrangement. As Australia experienced in its FTA negotiations with the US, it's not about a meeting of mutual interests but a game of how much wiggle room can be found on the edge of the US demands.

New Zealand has long sought a free trade deal with the US (our second largest export market). In theory it means that our agricultural exports will have an easier time in a large market, but the powerful US agricultural lobby will limit this while changes to IP law will mean an increase in transfers from NZ users to US owners. However, even if the result is actually a net loss to New Zealanders, an FTA with the US is a "win" politically.

S92. ACTA. TPP. Once again the battle is on to defend our rights as both consumers and producers of IP before our laws are rewritten to suit the US.

More information:

• Trans-Pacific Partnership (at MFAT)

Here's five things we learnt from reading the treaty.

USA wants internet-account termination

The full text confirms that the US would accept safe harbours for ISPs only if they implement termination policies under 'reasonable circumstances'. i.e. you're safe from prosecution if you cut off anyone who we accuse of infringing copyright. This is similar to the provisions of section 92A of the Copyright Act that were defeated in NZ last year.

It would also require ISPs to remove or disable access to content on demand. This is the US's attempt to get other countries to adopt the provisions of their DMCA (Digital Millennium Copyright Act). Oddly, this provision has an exclusion for any provider acting soley as as a conduit, which appears inconsistent with the demand for account termination.

New Zealand is noted as being opposed to internet account termination.

Japan is unconvinced by the need for anti-TPM laws

More than a page of the text goes into Japan's views about laws prohibiting devices that stop people breaking copy protection mechanisms (TPMs). New Zealand already has such a law although we make an exception that allows us to avoid region coding as used on DVDs. Japan puts this pretty strongly:

Japan would like to know from the US or other countries which adopt a restriction on circumvention of access control, the concrete example and data and background of the legislation. That is, amount of harm by circumvention of access control, how effective the legal remedy against the circumvention of access control was (e.g. shrinkage of harm, number of litigation cases, what kind of major actions were ceased in terms of copyright protection perspective).

We'd be interested to hear what those arguments were too.

The treaty attempts to establish a global standard for awarding costs

A whole section is devoted to finding a universal solution to how the costs of legal action involving infringing goods is awarded. There is a vast array of different variants presented in the text as each country argues for its own version. It seems bizarre for a trade agreement to be dabbling in basic elements of a country's legal system.

NZ does not require evidence to justify seizing infringing goods

The treaty has New Zealand more than willing to allow a rights-holder to demand the seizure of goods they think may infringe, without having to provide any evidence. There is also no penalty for making false accusations.

Nobody can agree on the scope

This isn't a new thing but it's worth mentioning again. The text shows an ongoing battle between those who want to limit the the treaty to copyright and related trademarks, and those who want it to cover any intellectual property.