Limitation periods control the length of time a claimant has to bring legal action, for example following an infringement of their copyright, and these periods vary from country to country.  In the UK, the relevant period is 6 years from the date on which the cause of action accrued for copyright infringement.  The upshot of this is that claims for compensation will only stretch back 6 years – so if you wrote a book in 2003, and it was copied and resold without your permission until the end of 2005, by the end of this year it would no longer be possible to bring a claim for the profits made from that infringement.  If the infringement continues, compensation will only be available in relation to a rolling 6 year period.  What is important is to remain vigilant.  Services like Copyscape allow you to scan the web for reproductions of your content; for images the equivalent is available through Google Similar Image Search, or Tineye; but for works sold offline, it may be less straightforward.

The pair founded the Pirate Bay back in 2003, and the site quickly became infamous as a place to find and illegally download copyrighted content including music and movies.  The site relied on BitTorrent, a protocol making it possible for thousands of users to share the burden of distributing files, and meaning that the Pirate Bay did not need to host any copyrighted material itself.   Instead it simply offered a search facility allowing users to find out what content was being shared, and where to get it.

In contrast, Bayfiles aims to provide users with faster downloads and increased reliability through the HTTP protocol.   HTTP is used when retrieving webpages and the vast majority of other material found by typical users on the world wide web.  It involves downloading files straight from a server.  So, unlike with the Pirate Bay, BayFiles intends to directly host the files being shared.  An oft cited argument against alleged infringement of services like the Pirate Bay is that they do not store or transmit infringing content; should Bayfiles be used by pirates this will not be the case, and it might seem therefore that there is an increased risk of liability for infringement.  Out of the frying pan and into the fire perhaps?

Co-founder Fredrik Neij explains the choice of HTTP saying ‘BitTorrent is increasingly throttled or even filtered by ISPs, HTTP usually is not’.  On the subject of copyright infringement, BayFiles have said that they will follow potential complaints and take down files that might infringe copyright when identified. They intend to comply with the Digital Millennium Copyright Act (DMCA) and have registered DMCA officers on board to handle complaints.  Their terms of service explicitly provide that content which violates third party copyrights will not be accepted, and that they will terminate without notice and without recourse, accounts of holders who are repeat infringers of copyright.  The site will log the IP addresses of uploaders, and disclose these if legally obliged to do so, but details of downloaders will not be retained.

A variety of similar services exist, such as MegaUpload and RapidShare, and perhaps through diligent compliance with copyright law, and prompt action in response to notices of infringement they continue to operate despite hosting a range of copyright content.   That is not to say that they haven’t come under fire – as illustrated by actions in both the US and Germany.

The founders have described that their ultimate goal as making sharing effortless and efficient while maintaining privacy.  They note:

‘Storage and transfers on Bayfiles also preserve users’ privacy. And another advantage is that users can be sure that content stays up, which is important for personal backups. It also guarantees that other personal files such as your MP3 collection are always accessible; so users are able to stream it live to any device.’

Admirable goals, copyright compliance and easy file sharing for all.  Despite the founder’s aims, some remain skeptical that the site will avoid infringement.  A lawyer with legal firm Cobbetts told the BBC “I suspect what they’re concentrating on is the idea that if it can be shown that they’re infringing or facilitating the infringement of an identifiable copyright work, they will comply with the requirement to notice and take down in time ….  So there will be a lot of infringement – but they are basically saying if you catch us we will cough’.

Nevertheless, the new venture is a far cry from a site which took a somewhat less positive view of the rights of copyright owners, and the work of their lawyers [see here].

Hargreaves emphasised the drive for reform should be based on evidence and not lobbying.

His reflection on the Digital Economy Act is that strong online enforcement should be carefully monitored. He highlighted a tough approach on enforcement of copyright should be balanced with education, open and competitive markets in licensing digital content and modernising the law (p10).

In his series of 10 recommendations to the government he encourages the UK to align itself with the EU framework to start to make use of existing exceptions, such as format shifting, non-commercial research, parodies and library archiving. Some welcome this move as being ‘worth considering’; the Wellcome Trust endorses particularly the non-commercial research exception.

Turning his attention to licensing, his ambition is to create the “world’s first Digital Copyright Exchange” (p4). This will allow rights owners to sell licences in their work and to make market transactions faster. The National Union of Journalists already consider this proposal to be problematic.

Hargreaves also seems keen to see the UK support moves by EU commission for cross border licensing and wants to release the “treasure trove” orphan works into the market (this was met with a lukewarm reception by professional photographers).

The recurring theme in his discussions on copyright reform is that more flexibility is needed.  This is neatly summed up with him asserting: “Copying should be lawful where it is for private purposes, or does not damage the underlying aims of copyright” (p8), which is refers  to as “the provision of incentives to creators” (p55).

Of particular interest are his proposals to essentially upgrade the IPO. He wants to develop their role to be able to produce formal opinions to help clarify the law where needed. He envisages the IPO giving evidence based recommendations to competition authorities and statutory opinions for the consideration of judges.

Further, to target the needs of SMEs for low cost quality advice, he suggests the IPO provide advice to individuals and/or accredit ‘lower cost providers of integrated IP legal and commercial advice’ (p104). He suggests models should be followed “elsewhere in the legal world, where paralegal services are offered by individuals less qualified than full scale patent attorneys” (p93).

The report does not provide further detail about how this would work in practice and the criteria the IPO would employ when deciding whether to accredit an IP advice provider. Is this a question of the IPO for example providing “parallel structures [..] for substitution of patent attorneys”? It is nevertheless questionable in view of budget cuts how the role of the IPO could possibly be increased.

‘Because copyright law can be complicated, education is critical to ensure that our users understand the rules and continue to play by them. That’s why today we’re releasing a new tutorial on copyright and a redesigned copyright help center. We’re also making two changes to our copyright process to be sure that our users understand the rules, and that users who abide by those rules can remain active on the site,’ YouTube says.

Users who receive a notification telling them they have been infringing copyright laws, will be required to watch a cartoon that goes over the basics of copyright infringement and helps to show them how they have infringed copyright law and how this affects an industry.

The users will then have to pass an online test to demonstrate they have actually watched the video all the way through in order to be able to return to using the site. Previously YouTube operated a three-strike policy where YouTube users’ accounts would be suspended if they got three copyright notices. Now with the new ‘School’ policy in place, those who complete the YouTube Copyright School will be able to get their strikes removed.

This move was not something Google has been required to do.  Last year Google fought a lawsuit with Viacom over copyright infringement. In the case YouTube insisted they should not be held liable for copyright infringement on the site, and that the Digital Millennium Copyright Act should protect it. The ruling found YouTube was adhering to takedown notices when informed of infringements by copyright holders. Despite winning the case last year, Google has still decided to take steps to help prevent copyright violations. YouTube has taken on board criticisms by the entertainment industry that it was not doing enough to combat copyright violations and has decided to do its bit.

In its blog post YouTube states ‘It’s ultimately your responsibility to know whether you possess the rights for a particular piece of content before uploading it to YouTube. If you’re at all uncertain of your rights or whether a particular use of content is legal under your local laws, you should contact a qualified copyright attorney,’

Whether or not this new copyright policy will work better than their old policy remains to be seen but it marks a move towards education instead of simply punishing people for infringing copyright.

Freedom of Expression
This right is deeply entrenched in law with the European Convention of Human rights (in the UK with the Human Rights Act) and now the EU’s version the Charter of Fundamental Rights.

That is not to say it is an absolute right, rather, it is expected that countries are able to encroach on this when needed.
However the Convention and Charter regulate how this is done and for how long.

One of the main controls is to ensure any encroachment has a solid legal basis (see article 52 (1) ).

Another consideration is that the inroad into an individual’s freedom of expression should be proportionate to the outcome sought (don’t use a sledge hammer to crack a nut).

Practically speaking, with the onset of the Lisbon treaty the CJEU must now consider the Charter to have the same validity as any other EU treaties, meaning when they address a problem, which affects the single market for example and the application of EU laws, they must also consider the effect on the Charter.

It is precisely within this frame that the AG last week considered a measure taken by a Court in Belgium to address illegal file sharing.

Scarlet v SABAM
The SABAM is the Belgian equivalent of PRS, a royalty collecting agency representing music artists.

They successfully applied to the lower court of Bruxelles for an injunction against an ISP named Scarlet.

The scope of the injunction was to monitor, identify, filter and block communications where illegal file sharing was taking place, the duration of the injunction was indefinite and the cost of managing this was to be borne by the ISP entirely.

Scarlet appealed against the legality of this injunction to the Court of Appeal of Bruxelles, who deferred the question to the CJEU.

The particular question put to the CJEU was whether the domestic law relied upon by the judge, set in the context of the Charter and other EU laws including data protection, could legitimise granting such a far-reaching remedy.

Important to note here the lower Court relied upon a domestic law, which allows it to give an order to cease copyright infringement. But even more interesting was that this law was in itself a transposition of EU law (article 8(3) of directive 2001/29 and article 11 of directive 2004/48).

So the question essentially touched on not only whether Belgian law could warrant such an injunction but also whether the underpinning EU law could support this type of action.

The AG’s Opinion
The AG thought not (see in particular section E  of Opinion; currently the opinion is only available in French but can be auto translated by Google Translate ) For the AG, under the Charter, the quality of any law should be sufficiently precise that others can be certain of its effects and adjust their behaviour accordingly. Using the words of the European Court of Human Rights the AG said the law should be “formulated with sufficient precision […]  to foresee […] the consequences which a given action may entail” (para 94)

To expand further on this notion, the AG referred to a Turkish case brought to the European Court of Human Rights where the law in question gave the power to chief prison officers to intercept and retain prisoner correspondence if the officer thought the contents were “embarrassing” (Footnote 85 of the Opinion). It was thought such a law did not indicate with sufficient clarity the scope and conditions for the exercise of this power by those authorities.

So details are crucial if a law is to be in line with the Charter, primarily, so people can foresee the consequences.

In this case, from the point of view of Scarlet, the adoption by the lower court of this injunction was an extraordinary measure, both difficult to foresee and due to the serious economic consequences smacked more of being arbitrary.

The ISP was demanded to achieve the result of blocking illegal file sharing but the solution of how this could be done was completely innovative.

Also the injunction gave no guarantee of how subscribers’ personal data would be protected. Nor did it provide any recourse for appeal by affected subscribers.

On this basis, the AG concluded the national law and by implication EU law could not have given authorisation for such a measure. Essentially there was no solid basis in law for this remedy when read in light of the Charter.

Digital Economy Act
If the Court decides to follow this Opinion then other EU countries who are rolling out new laws to combat internet copyright infringement may take more time to stamp out the details of their laws rather than handing over general powers to the judiciary or executive.

How may this affect the UK and the Digital Economy Act?

The UK is obliged to check compatibility with the Human Rights Act (HRA) when passing any new law.

Lord Mandelson okayed the Digital Economy Bill in the Commons but when the bill reached the House of Lords Joint Committee of Human Rights, concerns were raised about so-called ‘skeletal measures’ where powers are granted under the Act and the detail worked out in secondary legislation.

In fact, the Joint Committee said it was “impossible [to] assess fully” whether the Bill is compatible with the HRA due to the lack of detail. Not a good sign. (see in particular 1.28).

One such example of a ‘skeletal measure’ is Article 18 of the Act which allows for the secretary of state to introduce ‘technical measures’ to limit access to the internet for alleged infringing subscribers.

This particular measure is currently under judicial review by the high court but this SABAM Opinion could be the tipping point for a declaration of incompatibility with the Human Rights Act, or maybe there is a referral to the CJEU in the waiting.

Luckily for the government a referral to the CJEU would not see the Digital Economy Act being scrutinised in the same way as Belgium law has been under the Charter. The UK added a few provisos when giving the Charter the force of law with the Lisbon treaty, one of those was to preclude the CJEU from judging whether a UK law violates the Charter (see article 1 of protocol 7).

Interestingly the Telegraph have noted that the Government are circumventing the need to even rely upon article 18 Digital Economy Act by opening “talks between ISPs and the music industry to encourage a voluntary agreement on a list of websites that would be blocked”.

In conclusion, in the UK, it is understandable for the government to grant some general powers rather than type out every possible detail in the law when addressing copyright infringement. This is particularly true in the field of technology and the internet, where flexibility is needed to adapt to this ever changing environment. But at the same, it is equally important in light of the essence of the SABAM opinion to ensure sufficient precision in the law to ensure its validity when placed under European human rights scrutiny.

Interestingly he is the first to have registered copyrights for the postures (see third post) and enforces these creative works unrelentingly. The aim being to standardise his workout in his licensed schools and prevent any brand dilution.   In June 2002 he sued one of his previous students as the latter had been using music in classes and not heating the room to the prescribed temperature.  Amongst some of the claims against the student was breach of licence as a franchisee, copyright and trade mark infringement. This was settled out of court for an undisclosed sum.

However it is somewhat debatable to what extent a sequence of pre-existing postures may attract copyright. Registering copyright in the US does not necessarily mean it is validated; the act of registration simply ‘establishes a public record of a copyright claim’.

A few years later a collective of yoga practitioners, named the Open Source Yoga Unity, brought an action against Bikram challenging the validity of his copyright in the sequence of postures. Both parties petitioned the court for summary judgment, a legal procedure to request the Court to review the substance of the issues and decide whether either party has a case, but the Court denied both motions. The case was later settled. The judge, when delivering his order on summary judgement, commented in principal on the validity of copyright in a sequence of postures and alluded to the possibility that a compilation of yoga asanas can be ‘protected under the copyright laws in the same manner as other compilations’ (see page 3). The level of protection would be deemed to be ‘thin’ for this type of copyright involving ‘exact or near-exact duplications of his [Bikram’s] yoga sequence’ (page 4).

Due to the settlement, no court has yet had to decide on the actual validity of Bikram’s copyright claims.

Some opined that Bikram yoga is a ‘system’ and, as a result under US law, would not benefit from copyright protection. (page 10 of extract)

The same author also argued had Bikram described his sequence as an ‘expressive dance and accentuated its aesthetic value’ then he could have been accorded maximum copyright protection. This is on the basis that the ‘standard of protection for dance was quite broad’ (page 17).

Rather Bikram has lauded the medical benefits arising from application of the system in its entirety, which makes one consider whether patent registration may be more relevant. This is because the system may be described as a ‘functional process’.

What is of interest here is that the Indian government, reacting to the perceived threat of privatising Indian culture, have been collating all known asanas into a ‘prior art’ database to prevent the patenting of yoga – this database is due to be published over the next couple of months. However this would still not preclude yogi entrepreneurs from creating original compilations of the forms and potentially attracting copyright protection.

Even with uncertain copyright claims, Bikram Chowdury has managed to build a strong global brand. Being the first to franchise yoga he opens possibilities for other health practices to take inspiration. Will we see the next tai chi or shiatsu offshoot relying on the copyright of their particular system to build their business?

Indeed, part of his success may been down to him ‘policing his rights aggresively’ (Judge Hamilton see page 7 ). In particular this approach has benefitted his trademark by preventing it from becoming generic over time. In contrast PILATES, another form of restorative exercise, became unregistrable in the US as a trade mark due to it signifying a type of activity rather than denoting the origin of the services, namely the founder Joseph Pilates. This brings into sharp focus the importance of adopting a proactive stance to trade mark protection.

Hargreaves Review

Terms of reference
The terms of reference of the Hargreaves Review are to propose how UK’s IP framework can further promote entrepreneurialism, economic growth and social and commercial innovation.  It will aim to identify barriers to growth in the IP system, and how to overcome them.

Specifically the subject under examination is barriers to new internet-based business models, including information access, and costs of obtaining permissions from existing rights-holders.

The review was launched by the Prime Minister, David Cameron last month as reported by the BBC.  Apparently the Prime Minister was particularly interested in the fact that the founders of Google had told the government they could not have started their company in Britain.  “Over there, they have what are called ‘fair-use’ provisions, which some people believe gives companies more breathing space to create new products and services”.

What is the position in USA?
It is interesting to find out how the situation differs in the USA in practice, and the extent to which  the differences over there are down to fair use.

Google was on the receiving end of a law suit from AFP, a news agency in 2005.  It won the case partly by arguing that headlines were uncopyrightable.  By contrast, in the Meltwater decision recently it was decided that headlines are copyright.

What might the Hargreaves Review do?
So what might the Hargreaves Review do to alleviate some of the issues the law faces?  As the Review is to make recommendations, among other things, on what short and medium term measures may be taken now within the international framework to give the UK a competitive advantage, their remit is quite broad.  It will include an assessment as to how the IP framework could better enable new business models appropriate to the digital age, in terms of reducing the cost and complexity of enforcing IP rights within the UK and internationally as well as the cost and complexity to SMEs of accessing IP services to help them to protect and exploit IP.

Orphan works
One immediate and well known problem I would mention for internet businesses is orphan works, and whether there are possible ways such as copyright registration to address the problem they pose.

A distinguishing feature of copyright, when compared to other intellectual property rights such as patents and trademarks, is that it does not require the creator to actively register his or her creation. Their work is automatically protected, and remains so until 70 years after the death of the creator, at which point it enters the public domain.

Although, this is seen by many as an advantageous characteristic of the copyright system, encouraging as it does the creation of new works whose authors need not worry about formal registration, on the other hand, it is a disadvantage for doing business online.

In the digital age copying, reworking and remixing work is as common as breathing.  So the lack of any copyright registration formalities makes it increasingly difficult for creators to legally produce derivative works. A derivative work could include a translation, creating a podcast from a written article, or writing a play based on a book, and so on.

The inability to trace the copyright owner in order to acquire permission or agree licensing terms is a serious problem, especially, given the speed that is often essential online.

A famous example of this occurred during the development of the Google Books project, where Google found they were simply unable to establish the identity of copyright owners of numerous texts. What once appeared to be an advantage of an efficient copyright regime requiring no initial formalities has been subsequently rendered a rather cumbersome stumbling block when applied online.

Works whose current copyright owner cannot be identified, have been labelled “orphan works” and the scale of the problem is not small by any means. Indeed, the British Library estimates that 40% of its in-copyright stock is orphaned in this sense.

Practical Consequences
A would-be derivative author in the UK must demonstrate that they have made ‘reasonable efforts’ to trace the current copyright owner. Unfortunately however, this protection only applies to anonymous and pseudonymous works. In reality therefore, there is little leeway for a prospective borrower to do so without infringing copyright. Even if the copyright owner is found, the process is likely to cost time and money and is perhaps not a viable option for a small business.

Other jurisdictions are often more permissive. Under Canadian law for example, a licensing scheme allows licences for orphaned works to be issued following a search of “reasonable efforts” by the prospective user. A similar light-touch system recently proposed in the United States would enable the use of orphan works in a similar manner.

Until such time as the UK identifies reforms for this area of copyright law, which is currently out of step with the internet age, businesses are effectively unable to use orphan works in view of the time likely to be wasted in this pursuit.  What is ideally needed, is something as quick and easy as the solution currently used online – which is to try to identify and use works licensed under the increasingly popular Creative Commons system.

Often newcomers to the internet freely copy and paste from other websites, whether there is a copyright notice on the site or not, but particularly if there is no copyright notice.  They assume they can use any work they like on the internet, or that the lack of a copyright notice means that the work is in the public domain.  When experienced journalists make this mistake as Cooks Source did recently  (with surprising results – see the latest comments on their facebook page here) you know there must be widespread confusion about the law.

So it is interesting that David Cameron has just announced a review of UK copyright laws to bring them up to date with the internet age.

In general the strict letter of copyright law is not always observed or enforced on the internet but you still need to be aware of what works are protected by copyright, what you may or may not do with other people’s copyright works, and how you find out this information on the internet.  Otherwise, the copyright owner may pop up and, at the very least, demand that you stop using their copyright work and take it down.

Creative Commons Licence
Creative Commons or ‘Copyleft’ as it is sometimes referred to, is a form of licensing in which the creator of the piece surrenders some but not all of their rights under copyright law.  There are a few different types of Creative Commons Licence.  The most permissive form allows the person copying the work the same freedoms as the author including the right to use the work, share the work, modify the work and then distribute the modified work. The big catch to this is that if you use a work under this type of licence you cannot receive any financial gain or profit from it and you cannot restrict others from using it.  If you try to do so you will be violating the original licence.

On the internet if you use content from other sites which use this kind of licence then you will have to licence any further work under these same conditions. Choosing content which has this type of licence is good for blogging but would not be well suited to a website where you are running a business.

Paying a fee for a licence gives you permission to use that image, but the copyright of that image does not belong to you and you must comply with the conditions of the licence which the creator sets out. One condition which may be applied to a licence is ‘Attribution’ which means that others can copy, display and distribute the copyrighted work but only if they give credit the way the creator requests.

Another condition which may apply to a licence is ‘Share Alike’, which means the creator allows others to distribute derivative works (that means, works based on the original) only under a licence identical to the that governing the original work.

A ‘Non-Commercial’ condition may apply to a licence, meaning that others can copy, display and distribute the work but only for non-commercial purposes. Lastly, a ‘No Derivative Works’ condition may apply, which means that others can copy, display and distribute the work but may not create derivative works based n it. These  different conditions can be mixed and matched to suit the Licensor’s needs.

Complexity of copyright laws
Copyright laws are unduly complicated which is why licensing terms, such as the above are, in turn,  complicated.  So it is quite common for people not to know whether an image found on Google pictures or elsewhere on the web is protected by copyright, and if so, whether permission to use it would be forthcoming.  It is necessary to have quite a good grasp of copyright law, licensing, as well as Creative Common licences to know what use you may make of images.

Google Images
Google’s advanced image search gives you information about the copyright position of Google images. When searching for an image using this advanced search, the images which will appear are those with a licence, and when clicking through to the image you will usually find information about the type of creative commons licence granted. You select the type of licence you would like to search for, and so your results will be restricted to images marked with CC or your chosen type of licence. You can then use the image provided you comply with the terms.

Assignment and Licence of Copyright Works
If you are commissioning a photo or image then you may not realise you will not own the copyright in it unless you obtain a written assignment from the photographer transferring copyright to you.

Once the copyright has been assigned to you, you have full rights and may use the image however you wish.  Otherwise, make sure you get permission (a licence) in writing to use the photograph in all the ways in which you may want to use it in future.  Sometimes, photographers will charge a royalty for this licence after a period of time, or for certain uses.

A licence is a contractual agreement between the copyright owner and the user, giving permission for the use of the copyrighted work. So, if you search on an image library like iStock, read the licence terms before you buy the image, to make sure it covers your intended use.

The licence you receive from a commissioned photographer may be exclusive or non-exclusive. If the licence is exclusive it means only you may use the work (although the photographer may retain certain rights, such as to display the work in exhibitions).  There may be other conditions attached – such as geographic area.

A non-exclusive licence is more common and enables the copyright owner to grant the same or other rights in the image to others, as well as to continue using the copyright work themselves.

It will be interesting to see how UK copyright laws will be amended to bring them into the internet age.

This victory closely followed a previous one earier this year against Viacom. In this case Viacom accused Google of “massive intentional copyright infringement” but the Manhattan Judge ruled against this. Viacom had claimed that thousands of copyrighted videos were posted on YouTube, which Google had known and done nothing about. However, the Judge declared, “Mere knowledge of prevalence of such activity in general is not enough. The provider need not monitor or seek out facts indicating such activity” and ruled in favour of Google. Google were deemed to be protected under safe harbor provisions in the DMCA as they immediately removed the material once they were notified of the infringing content.

However, for some, the almost blanket amnesty afforded to hosts seems to lead to judgments where the evidence is not engaged with as closely as it should be. It was even thought that the Viacom judgment was maybe a little rushed, because seemingly the solution was evident or it was evident that Viacom was going to appeal –which it did.  But on the point of evidence Viacom did not assist the integrity of their case when it transpired that they had uploaded some of the content which they claimed had been infringed.

Nonetheless, both these rulings respresent landmark victories. Google called the ruling concerning Telecinco a “clear victory for the Internet and the rules that govern it”. If Google had not been successful in achieving victories in these two cases then the way people use the Internet could have significantly changed. David Sohn, a lawyer for the Center for Democracy and Technology, said: “Without this decision, user-generated content would dry up and the Internet would cease to be a participatory medium“.

The outcome of the two cases brought against YouTube can be viewed as a positive sign from other high profile sites such as Facebook who also relies heavily on user generated content. Without these victories the knock-on consequences of the cases could have been dire news for a number of different sites and for the way the Internet runs as a whole.

Those businesses likely to be hardest hit by the changes are Internet Service Providers (ISPs), who now face the challenge of implementing procedures to comply with requirements set out in the Act to combat online piracy.  It will be some time before the effects of the Act are well enough understood to offer clear and comprehensive advice on the steps ISPs must take, and a thorough treatment of these is outside the scope of this article, but it is essential that businesses providing customers with internet access take legal advice early on, or they risk facing fines of up to £250,000.

For any business operating a website, an important element of the new legislation is the power granted by the Act in relation to injunctions blocking access to infringing websites.  The Act allows the Secretary of State to set out regulations providing injunctive relief where a website “has been, is being or is likely to be used for or in connection with an activity that infringes copyright”.  Until this power is used in practice it is difficult to predict the impact it will have, but businesses who depend on an online presence would be well advised to establish auditing procedures to determine whether their websites fall within the scope of the provision.  Sites that allow visitors to freely share documents or links without careful moderation are most vulnerable.

The Act also provides for the blocking, or limiting, of an internet connection in response to its use in connection with copyright infringement.  While this has been more widely discussed so far as it relates to domestic internet use, it is of the utmost importance to business owners.  If employees use the internet while at work to access or share infringing material, the provisions may just as easily be used to block or limit that connection.  Such a sanction has the potential to cripple a modern business venture, and it is not only the activity of those in your employ which may constitute cause for concern.  If your internet connection is shared over an unsecured wireless network, then infringing use of the connection by a passerby can have similar consequences.

The best way to manage some of the risks outlined in this post is to take measures early on.  Some steps you might take include:

• Have a clear policy for use of the internet by employees, you might also consider blocking certain high-risk websites
• Audit your own business websites to ensure that you are not offering copyright material for download
• Ensure that any user-generated content on your sites is carefully moderated
• If you use one, secure your wireless network to the fullest extent that is practical given your circumstances

For further information on developments surrounding the Digital Economy Act,  you might be interested in reading the following:

• TalkTalk and BT launch challenge to Digital Economy Act
  Read the Guardian’s analysis of the activities of two of the largest ISPs in the UK, who are seeking judicial review of the Act.
• Ofcom: Draft Initial Obligations Code
  The Independent regulator for the UK communications industries recently published a draft code, intended to give substance to some of the provisions of the Act.