Andrew Baker is an LLB/BCL candidate at McGill University Faculty of Law.

The United Kingdom is proceeding with implementation of the Digital Economy Act (DEA) after the legislation recently passed through the judicial review process begun last year.

The implementation of the DEA is another measure in the UK’s attempt to modernize the digital copyright regulatory regime.  The government has noted that online copyright infringement poses a major barrier to economic growth in creative industries which contribute £59 billion to the economy each year. 

Professor Ian Hargreaves’ recently released Review of Intellectual Property and Growth outlines many of these issues in detail.  The government plans to adopt all ten recommendations included in the report.  ISPs in the UK have responded negatively to the DEA provisions, arguing against the obligation to inform subscribers that their account is infringing copyright and challenging the costs involved with policing infringers in court.  Nevertheless, the DEA has passed judicial review largely unscathed.

As a result, the government has outlined that the next stage of implementation will occur in two steps.

Firstly, implementation of the DEA requires Parliament to pass a Statutory Instrument (SI) to allow for the sharing of costs which sets out how the scheme will be financed.  Initially, the government had hoped to share the costs 75%:25% between copyright holders and ISPs respectively for the establishment of the scheme under UK regulator, Ofcom.  However, judicial review determined that ISPs cannot be held responsible for qualifying costs such as the establishment of an appeals body and the administration and enforcement of the initial obligations of the DEA.  The government has therefore decided to amend the SI to remove any obligation for ISPs to pay for qualifying costs, but the 75%:25% cost sharing regime will remain in place for later operational expenses.

The SI also lays out the financing of the appeals process.  Once the scheme is operational, subscribers will receive a notification of infringement.  When a notification is received, subscribers can appeal the finding by paying a £20 fee which would be refunded upon a successful appeal.  Full details of the Sharing of Costs SI can be found here.

Secondly, Parliament must approve Ofcom’s Official Obligations Code, which sets out the details of how the regulator will deal with cases of digital copyright infringement.  The government has decided against utilizing any site-blocking measures concluding that infringers will easily alter their site locations before any injunction passes through the court process.   Details on the Initial Obligations Code remain scarce as the final draft has been delayed by a year, but the government still plans to send out infringement notifications by late 2012.

While Ofcom continues to debate the best methods for dealing with copyright infringers, the new cost sharing plan and the establishment of the appeals process represents another step to the final implementation of the DEA.