Anti-piracy code: Three strikes and you're outed

The day after a landmark piracy judgement gave Dallas Buyers Club the right to chase individual pirates, a new three-strikes scheme will "facilitate" this process for all rights holders through ISPs.

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Australia's Communications Alliance has released the final version of an industry code targeted at tackling piracy in Australia, officially putting 'three strikes' warning notices on the table for Internet users.

A draft version of the code was released in February, and the final document has now been filed with the Australian Communications and Media Authority, which will consider registering as a binding agreement applying to roughly 70 of Australia's largest ISPs.

Under the Copyright Notice Scheme code [PDF], residential Internet users that are found pirating content will be subject to a series of "escalating" warning notices from rights holders, sent via ISPs. The notices will warn users that they are infringing copyright, and that they will face legal action if they get three strikes recorded against their IP address -- that is, if they receive an Education, Warning and Final notice -- within a 12 month period.

Communications Alliance, the body representing Australia's telecommunications and Internet service providers, received more than 370 submissions from the public after the draft code was released. After this consultation, Comms Alliance has removed a proposed fee structure that would have seen consumers paying AU$25 in order to challenge an infringement notice and have it reviewed.

Comms Alliance has also committed to providing "stronger consumer representation on the Copyright Information Panel" which will oversee the notice scheme and accompanying information website.

According to Communications Alliance, the three-strikes Copyright Notice Scheme is designed to change consumers' behaviour and "help steer them toward lawful sources of content." To this end, the scheme will establish a website with information about "matters relating to the legal access to content" though it is unclear what this will entail.

Rights holders from the music, film and television industries previously banded together to develop a Digital Content Guide to offer consumers information on legal content, though this site is little more than a website directory. Users cannot search the guide for specific content titles, there is no pricing information and headings such as "Movies & TV" lead to a page of service provider logos for the likes of Foxtel, Netflix and catch-up TV, each linking to external landing pages.

Streamlining speculative invoicing?

While Comms Alliance says there are no "explicit sanctions against Internet users" set out in the code, it does allow for a "'facilitated preliminary discovery' process through which ISPs can assist Rights Holders who may decide to take legal action against persistent infringers."

The release of the code comes just one day after a game-changing judgement was handed down in the Federal Court in the case between iiNet and Dallas Buyers Club, covering a similar "preliminary discovery" process. In this case, Dallas Buyers Club LLC petitioned the court to gain access to iiNet customer details matching IP addresses allegedly associated with copyright infringement. The Federal Court found in favour of the rights holders, requiring iiNet to pass on customer details.

However, consumer groups are now concerned that the new copyright code will streamline this preliminary discovery process and reduce it to a simple "rubber stamp" on rights holders' applications to access Internet users' information.

"The Code sets up a system that will force Internet Service Providers to hand over customer details to rights holders, who will have free rein to use this information to launch court action," said Choice Campaigns Manager Erin Turner.

"There will be no one checking to make sure rights holders aren't seeking to intimidate and bully Australians who may have done nothing wrong. This Code could be amended to better balance the rights of both copyright owners and consumers, by simply refusing to allow rights holders who send these 'pay-up-or-else' letters from participating."

Similarly, the Australian Communications Consumer Action Network raised concerns that, after the Dallas Buyers Club judgement, the Copyright Code could "streamline speculative invoicing."

The practice of speculative invoicing is well established in other regions such as the United States, where individuals accused of copyright infringement can be sent letters by rights holders seeking significant damages for financial losses caused by piracy, or the option to pay a fee to settle out of court.

"The Dallas Buyers Club Federal Court decision is worrying because in the future Australian consumers may be sent threatening letters shaking them down for money or face the threat of legal action," said the CEO of ACCAN, Teresa Corbin.

To prevent this, ACCAN has proposed that any rights holder found engaging in the process of speculative invoicing be "barred" from sending three-strikes notices under the industry scheme.

The release of the final code comes at the request of the Federal Government, which announced a crack down on copyright infringement in late 2014. Communications Minister Malcolm Turnbull and Attorney-General George Brandis issued an ultimatum for the industry to develop an anti-piracy code by today, while also announcing that the Government would introduce site-blocking legislation to block overseas websites deemed to be facilitating piracy.

The legislation was tabled in Parliament in late March.