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Can South African Internet Service Providers be held liable for allowing subscribers to access foreign sites?

Thursday, March 10th, 2011

The South African Chapter of the Report on Media Piracy in Emerging Economies is focused on how people behave, and the factors shaping that behavior, not on precise questions of law. The report does refer to an incident that raises interesting legal questions.

“In July 2009, RiSA [Recording Industry Association of South Africa] served a number of ISPs with blocking notices regarding two foreign websites, www.gomusic.ru and www.soundlike.com, both of which sell MP3s at prices well below those of local online music vendors. In this case, the ISPA [Internet Service Providers Association of South Africa] resisted the request and informed RiSA that the notices fell outside the scope of the ECT Act [Electronic Communications and Transactions Act.]” p119.

The Electronic Communications and Transactions Act 2002, Chapter XI deals with Limitation of Liability of Service Providers. But before the issue of limiting liability arises liability must be established. An Internet Service Provider does not need to prove that its liability is limited by the ECT Act if there is no liability in South African law.

The South African Copyright Act 1978 sets out various grounds for a claim of infringement in section 23:

23.-
(1) Copyright shall be infringed by any person, not being the owner of the copyright, who, without the licence of such owner, does or causes any other person to do, in the Republic, any act which the owner has the exclusive rights to do or to authorize.

(2) Without derogating from the generality of subsection (1), copyright shall be infringed by any person who, without the licence of the owner of the copyright and at a time when copyright subsists in a work-

(a) imports an article into the Republic for a purpose other than for his private and domestic use;

(b) sells, lets, or by way of trade offers or exposes for sale or hire in the Republic any article;

(c) distributes in the Republic any article for the purposes of trade, or for any other purpose, to such an extent that the owner of the copyright in question is prejudicially affected; or

(d) acquires an article relating to a computer program in the Republic, if to his knowledge the making of that article constituted an infringement of that copyright or would have constituted such an infringement if the article had been made in the Republic.

(3) The copyright in a literary or musical work shall be infringed by any person who permits a place of public entertainment to be used for a performance in public of the work, where the performance constitutes an infringement of the copyright in the work: Provided that this subsection shall not apply in a case where the person permitting the place of public entertainment to be so used was not aware and had no reasonable grounds for suspecting that the performance would be an infringement of the copyright.

Where does providing a service which allows users to access a foreign site which allegedly permits those users fit in to this section?

Does Section 23 (1) apply?
Q:Is the ISP making an unauthorised copy, or a derivative work?
Is the ISP making someone else make a copy or derivative work?
A: Merely allowing subscribers to access a site is not making a copy of a work. Subscribers may choose to access the site, and may choose to copy a work. However mere access to the site doesn’t necessarily involve making a copy.

Q: Would that copying necessarily be infringing? A: There is a personal use exception in the Copyright Act. Even if it would be infringing for a subscriber of a South African ISP to make a copy of a particular work merely enabling subscribers to reach the site from which in turn subscribers can in turn make an infringing copy is not the same as making that copy.
There is no basis for liability in section 23(1).

What about 23 (2) (a)?
Q: Is permitting access to a foriegn website “importing an article into the Republic other than for personal use without authority”?
A: The ISP may make it possible for a user to “import an article” i.e. copy a song but why should that that the ISP is “importing the article”? If that is true then SAA imports whatever is in a customer’s luggage and should be liable for it, and the Post Office imports anything in a parcel that it handles (and delays and loses as per standard operating procedure). Or if the subscriber is doing the importing and the subscriber’s use is personal, then the importing is legitimate? But if the importing is legitimate then how could the ISP be liable for providing a conduit for the legitimate import?
If the user is entitled to import the article for personal use then the ISP can’t be liable for enabling the user to do so. Even if a specific user did import an article into the Republic other than for personal use, why does that mean that the ISP should block all users from accessing a site which allegedly permitted the user to do so?

Does Section 23 (2) (b) apply?
Q: Does the ISP sell or lets an infringing article by enabling access to a foriegn website?
A: The foriegn website itself cannot be an infringing article in terms of this section. South African copyright law is confined to the boundaries of the Republic of South Africa. There may or may not be copies of copyright works on a foriegn website that infringe the law of that jurisdiction, but doesn’t make those copies infringing in South African law. And the website where copies are available is itself not a copy, and therefore cannot be an infringing article.
Section 23 (2) (b) does not apply.

What about Section 23 (c)?
Q: By enabling a subscriber to access a foreign website for (any) does an ISP distribute in the Republic an infringing article other purpose, to such an extent that the owner of the copyright in question is prejudicially affected? By enabling a subscriber to access a foreign website does an ISP distribute in the Republic an infringing article for the purposes of trade?
A: The website itself, as I’ve pointed out, doesn’t constitute an infringing article. If an apparently unauthorised copy is imported into the Republic by a subscriber for personal use then it turns out its not unauthorised after all, and so anyone enabling the subscriber to import the copy can’t be doing anything unlawful. It may seem to you that there is some overlap between the provisions of Section 23(2) which might negate the private use exemption. When courts read legislation they usually read it so that its not absurd and it would be absurd for part of Section 23 (2) to permit something and the remainder of Section 23 to prohibit it. Its more likely that 23(2)(c) is aimed at something else altogether, someone with a warehouse full of CD’s who hasn’t yet sold them, or since the Act was drafted in 1978 someone with a warehouse full of LP’s who hasn’t yet sold them, but intends to do so.

Section 23(2)(d) deals with computer programs, and Section 23(3) with physical premises so neither is germane.

There doesn’t seem to be a basis in the South African Copyright Act for holding an ISP liable for enabling access to a foriegn site which would allegedly permit South African subscribers to make copies that would allegedly be infringing.

But if there were liability then the question is whether the limitation under the Electronic Communications and Transactions Act would apply.

Chapter XI of the ECT Act deals with service provider liability. Section 75(1) provides an exemption for liability for hosting, section 74 for caching. An ISP giving access to a foriegn site neither hosts nor (usually) caches the objectionable material. At most the ISP is a ‘mere conduit’ or by merely allowing subscribers to access the Internet generally, a potential mere conduit. Section 73 of the ECT Act provides an excemption from liability for a service provider acting as a mere conduit.

Mere conduit
(1) A service provider is not liable for providing access to or for operating facilities for information systems or transmitting, routing or storage of
data messages via an information system under its control, as long as the service provider-

a. does not initiate the transmission;
b. does not select the addressee;
c. performs the functions in an automatic, technical manner without selection of the data; and
d. does not modify the data contained in the transmission.
(2) The acts of transmission, routing and of provision of access referred to in subsection (1) include the automatic, intermediate and
transient storage of the information transmitted in so far as this takes place.
for the sole purpose of carrying out the transmission in the information system;
b. in a manner that makes it ordinarily inaccessible to anyone other than anticipated recipients; and
c. for a period no longer than is reasonably necessary for the transmission.

There seems to be no basis in South African law to require an Internet Service provider to block access to a foriegn website because the website may enable a subscriber to make a copy of uncertain status. That is neither a particularly surprising nor a counter-intuitive outcome. Internet service providers are a type of ‘common carrier’. Common carriers perform an important economic and social function. Regulation of common carriers is usually aimed at ensuring that they do not discriminate between users, and do not use whatever market power they may have to extract monopoly rents, or engage in other anti-competitive behavior. Its in the public interest that ISP’s offer cheap, fast, non discriminatory transmission. To enable them to do so they are given conditional exemption from liability, although in this case it does not seem that there would be liability.

Disclaimer: I am an attorney but this blogpost doesn’t constitute legal advice*. If you want legal advice why not find one of the many fine law students I have taught over the years, some of whom are now fine attorney and pay her some money for legal advice.

*Anyone who thinks a blogpost is legal advice needs more help than I am able to give but there are suitably qualified members of the medical profession who may be able to help.

New research on commercial copyright infringement in South Africa

Tuesday, March 8th, 2011

Media Piracy in Emerging Economies is a remarkable new study on so called “piracy” of media goods in the emerging economies of Brazil, India, Russia and South Africa.

The report is available under a Consumer’s Dilemma license; its free for those outside of high income countries. Developing world readers of this blog will be able to download it free.

The chapter on South Africa is particularly important, since it presents the first independent, in depth investigation into the nature, scale and response to alleged copyright “piracy” in South Africa.

The report points out that lack of access to the channels for media goods; Internet access, cinemas, satellite tv, music and book shops has its origins in the ways in which apartheid structured the economy. In contemporary South Africa lack of access reveals the uneven nature of globalisation: “millions of South Africans have been integrated into a globalized media culture without a
corresponding expansion of access.”

One interesting finding is that while South African musicians condemn infringement of music copyright many musicians use unlicensed production software.

Apparently in response to public sector (police, SARS and prosecution0 enforcement practises trade in infringing goods appears to have become largely deformalised taking place primarily through neighborhood networks. Despite this the authors were not able to conclude whether the level of infringment has decreased or simply re-located.

The reports sketches the silhouette of copyright infringement of media goods in South Africa. Filling in the details will require more research, especially broad, rigorous, quantitative research. Important as such research is rightsholders, government and consumers will agree with the report that “the central question should be how to create vibrant,accessible media markets and how, in particular, to move South Africa out of the high-price,small-market equilibrium it shares with many other developing countries.”

Full disclose: I was afforded an opportunity to comment on the chapter on South Africa.