Anonymity is a great good on the Internet but increasingly there are calls for stricter identity checks.

Such requirements are not new. In daily life many people have encountered situations where they had to prove their identity. When opening a bank account, for example. But online it is rare.

If it’s up to a large group of organizations with ties to copyright industries, this should change. They call for stricter policies so that hosting companies, domain registrars, and advertisers must properly check who their customers are.

This message was sent in a letter to the European Commission this week. The signatories include anti-piracy outfits such as MPA, BREIN, BPI, IFPI, and RettighedsAlliancen, as well as the international brands Heineken, Nike, and Philips. Together, they call for thorough “know your customer” requirements.

Europe’s Digital Services Act

The letter was sent in response to a public inquiry on Europe’s proposed Digital Service Act, which will determine how online services and platforms are regulated. The senders zoom in on one element, namely, the “Know Your Business Customer” requirements for online platforms.

In the impact assessment published by the European Commission, such a requirement is highlighted. However, that ‘online’ applies to online marketplaces only. This is a missed opportunity and should be broadened, the letter notes.

Online Intermediaries Should Properly Identify Business Customers

According to European law, online businesses are already required to identify themselves based on Article 5 of the e-Commerce Directive. However, this is often ignored by bad actors. This is where the new requirements could prove helpful.

“The DSA represents a real opportunity to rectify the situation that allows bad actors to ignore Article 5 of the ECD with impunity,” the letter explains.

“A business cannot go online without a domain name, without being hosted, or without advertisement or payment services. These intermediary services, having a direct relationship with the business, are therefore best placed to make sure that only businesses that are willing to comply with the law have access to their services.”

The copyright holders and anti-piracy groups state that these checks won’t involve any active monitoring. Some simple due diligence checks based on information that’s publicly verifiable is already sufficient.

Identification Helps to Tackle Online Piracy

At the moment, scammers, counterfeiters, plus pirate sites and services can operate relatively easily in the dark. They often provide false information, when registering a domain name for example. More detailed checks could make this harder.

Knowing who’s behind a pirate site or service obviously makes enforcement efforts much easier. And when the provided information turns out to be false, the customers should be disconnected.

“Should the information provided prove to be manifestly wrong, or the intermediary be notified that the business customer isn’t who it claims to be, the intermediary should stop providing services until the business customer remedies the situation.”

Bad actors have been flaunting the law for years and the Digital Service Act provides an opportunity to fix this, the letter notes. Implementing stricter checks facilitates a “safe and trustworthy online environment” and will make it harder to “distribute illegal content,” the senders add.

Intermediaries Should (be forced) to Take Responsibility

TorrentFreak spoke to Tim Kuik, director of Dutch anti-piracy group BREIN, which is one of the letter’s signatories. He says that it’s no surprise that criminals use fake identities online. However, that intermediaries are not properly verifying the identities of customers is surprising.

“On the one hand, we see upstream providers that are reluctant to disclose customer identity to injured parties who then can not hold the perpetrators liable. On the other hand, we see that when customer identity is disclosed – ultimately providers have to in case of illegal activity – it is fake, either completely made up or of unsuspecting people and their addresses.”

“This frustrates enforcement against all kinds of illegal activity while intermediaries – unknowingly or not – indirectly earn income from it,” Kuik adds.

BREIN has repeatedly emphasized the importance of proper customer identification. Earlier this year it sued several hosting providers that worked with the pirate streaming CDN Moonwalk, to require these companies to verify the identity of customers and require resellers to do the same.

“The latter is necessary because we see a tendency of upstream providers using foreign parties either offshore or to sell in their respective countries, who then do not have true identity information and refuse to provide other identifying information,” Kuik tells us.

The idea to use stricter ‘know your customer’ regulations as a tool to thwart piracy is a hot topic. Just a few weeks ago, a group of prominent anti-piracy groups discussed the same matter in a webinar , which also involved Europol and the Italian Financial Police

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A copy of the letter sent to Brussels earlier this week is available here (pdf)

From: TF , for the latest news on copyright battles, piracy and more.

Last year there were fierce protests against the new EU Copyright Directive which, according to opponents, would result in broad upload filters on the web.

Despite this pushback, the directive passed , and individual EU member states began work to implement the text into local law.

This includes Article 17 (formerly known as Article 13), which requires many online services to license content from copyright holders. If that is not possible, these companies should ensure that infringing content is taken down and not re-uploaded to their services.

After last year’s media storm the upload filter news died down. However, behind the scenes, there is still a lot of work being done. In recent months there have been several stakeholder meetings discussing how the EU Directive can be best implemented by individual states.

Article 17 Guidance Consultation

To help things move forward, the European Commission launched a public consultation at the end of July. The Commission is working on an official guidance document for member states to help them implement Article 17 and has asked stakeholders for input.

The proposed guidance still keeps the door wide open for upload filtering but is also mindful of all the caveats that come with it. For example, it mentions that, when automated filters are used, online services should ensure that content isn’t removed without a good reason.

Specifically, it suggests that simply restoring inaccurately removed content after the fact isn’t good enough. Instead, “legitimate uses should also be considered at the upload of content.”

The public consultation officially ended last week. It has attracted dozens of submissions from key stakeholders many of which go into great detail. While it is impossible to summarize them all, it’s clear that the upload filter battle is far from over.

Copyright Groups are Very Concerned

Late last week a group of major copyright holder groups including IFPI , the MPA , ACT , and Eurocinema , sent a letter to EU Commissioner Thierry Breton, criticizing the drafted guidance document. They fear that the carefully constructed text of the directive will be watered down.

“We are very concerned that, in its Consultation Paper, the Commission is going against its original objective of providing a high level of protection for rightsholders and creators and to create a level playing field in the online Digital Single Market,” the groups write.

“It interprets essential aspects of Article 17 of the Directive in a manner that is incompatible with the wording and the objective of the Article, thus jeopardizing the balance of interests achieved by the EU legislature in Article 17,” their letter adds.

‘Likely Legitimate’ Content Should be Removed Until Further Order

The copyright holder groups identify several specific concerns. One refers to the suggestion that online services should keep content online when it’s “likely legitimate.”

This goes against the text of the agreed Copyright Directive which is highly problematic and creates legal uncertainty, they note. The copyright holders would prefer everything to be removed immediately and put back when content turns out to be legitimate.

“In particular, the possibility for ‘likely legitimate’ content to ‘stay up’ – while the possible application of exceptions and limitation is assessed – is inconsistent with this provision, as interpreted in light of its context and purpose.”

Upload Filter Opponents are Deeply Concerned

A few days after the copyright holder groups shared their concerns, Commissioner Breton also received a letter from several civil society and user rights organizations. These have been very critical of Article 17 and still protest automated upload filters.

“We remain deeply concerned that the guidance endorses the use of automated content blocking by online services even though it is clear that this will lead to the violation of fundamental rights,” the civil rights groups warn.

The organizations, including EFF , Communia , Creative Commons , and EDRi also note some positive changes. This includes the aforementioned suggestion that legal uses should be considered at the upload stage, which is the issue copyright holders are not happy with.

Human Review is Often Required

However, according to the user rights advocates, the public requires even broader protection. They want all content that’s not “manifestly infringing” to be reviewed by human eyes.

“Article 17 requires that all legal uses remain online, not only those that are ‘likely legitimate’ according to a superficial screening that is unlikely to reflect the complexity of copyright law. At minimum, the standard for the deletion of content should be ‘manifestly infringing’.

“In this context, it is essential that uploads that are not manifestly infringing remain available until the human review has been concluded,” the groups add.

It is now up to the European Commission to review all the submissions and come up with a final guidance document, which is expected to be published later this year. In addition to all the public commentary, there will likely be various lobbying efforts behind the scenes as well.

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A copy of the letter sent by the copyright holder groups is available here (pdf) . The letter sent by the civil society and user rights organizations can be found here (pdf) .

From: TF , for the latest news on copyright battles, piracy and more.

Last month, entertainment industry-backed group Digital Citizens Alliance and content protection company NAGRA published a new study that estimated the pirate IPTV market to be worth a billion dollars each year in the US alone.

These types of piracy studies are nothing new but what is interesting about this particular market is that even the biggest ‘pirate’ US players, if they take caution in what type of content they offer and how, are unlikely to find themselves on the wrong end of an aggressive criminal prosecution.

There are caveats and exclusions but in general terms, streaming piracy is not a felony in the United States.

The ‘Streaming Loophole’

That such a loophole exists in the United States under what many believe are some of the most strict copyright laws in the world is a surprise in itself. But exist it does and here’s how it came to be.

Under existing criminal copyright laws, felony penalties are only available for infringements that breach the exclusive rights of reproduction and distribution, i.e the unlawful copying of content and distribution to others. In many cases, however, streaming is viewed as infringing public performance rights, which is considered a misdemeanor.

The end result is that, regardless of the scale of a pirate streaming operation and how much revenue is generated by it, the hands of the authorities are effectively tied in respect of offenses that would otherwise attract years in prison.

Exceptions Exist, It’s Not a Complete Free-For-All

As ongoing cases against Megaupload and Jetflicks demonstrate, streaming offenses can sometimes enter the criminal realm. While some streaming services exploit the loophole cited above, others can face criminal charges when they are deemed to have breached reproduction and distribution rights, by copying infringing content and distributing it to others.

Also, as highlighted by the Department of Justice in a letter to the Senate last year, criminal prosecutions may also follow when unlicensed streaming operations are alleged to have committed other crimes, such as money laundering and racketeering, charges also being faced by Kim Dotcom and his Megaupload co-defendants.

Pressure Building To Close The Loophole

In an opinion piece published in The Hill yesterday, Keith Kupferschmid, chief of powerful industry group Copyright Alliance, again raised the issue of the loophole.

Echoing the sentiments of law enforcement groups, entertainment companies, filmmakers and sports groups that have contributed to the debate thus far, he urged Congress to ensure that “in appropriate large-scale commercial cases”, felony penalties are available to federal prosecutors.

“Virtually every significant form of willful, commercial piracy can be prosecuted as a felony under appropriate circumstances — including copying CDs, illegal file sharing, and even ‘camripping’ movies in the theater,” he wrote.

“But unlike all of these, streaming piracy — no matter how widespread or organized, and regardless of the amount of damage done — can only be prosecuted as a misdemeanor simply because when the laws were drafted streaming video wasn’t an option.”

Indeed, the laws that currently limit felony penalties to infringements involving reproduction and distribution were put in place almost three decades ago. At that time, widespread Internet use wasn’t yet a thing and the possibility of streaming movies or TV shows to the public was a distant dream.

Congress “Working Hard” to Close the Loophole

“Fortunately, Congress is working hard to solve this problem — convening negotiations and developing a simple two-page proposal that would close this ‘streaming loophole’ and ensure that in appropriate large-scale commercial cases, felony penalties are available to federal prosecutors,” Kupferschmid wrote.

“The resulting proposal is a consensus product with broad-based support. It is narrowly tailored to address the serious problem of commercial streaming piracy ensuring ordinary internet users, legitimate businesses, and non-commercial actors have nothing to fear from this proposal.”

The mention of ordinary Internet users remaining unaffected by these proposals is of interest. The last time a bill was presented to amend the relevant sections of the law – 17 U.S.C. § 506 and 18 U.S.C. § 2319 – to render criminal breaches of public performance rights punishable as felonies, things didn’t go well for copyright holders.

The Commercial Felony Streaming Act

Back in 2011, Bill S.978 – labeled the Commercial Streaming Felony Act – was introduced to the Senate in an effort to render unauthorized streaming of copyrighted content for “commercial advantage or personal financial gain” a felony punishable by up to five years in prison.

However, despite assurances that the intent wasn’t to penalize regular Internet users, concern began to build that ‘normal’ people (such as Justin Bieber who launched his career by posting cover versions of songs to YouTube) could be considered felons under the amendments.

Ultimately, however, the contents of the proposed amendments, which later formed part of the Stop Online Piracy Act (SOPA), were never passed due to unprecedented public outcry.

Not a Done Deal, But Momentum is Building

While companies that rely on streaming and physical product sales are desperate for the “streaming loophole” to be well and truly closed, this time around they will not have to contend with the scale of the uproar that accompanied the far-reaching SOPA bill.

Indeed, there seems to be optimism that Congress will see fit to accept the proposals which, according to Kupferschmid, are being formed with the assistance of tech companies, not potentially at their expense as per last time around .

“This highly transparent and rigorous process which included participation from groups and organizations of all perspectives — including the creative community and victims of streaming piracy as well as those representing internet users, technology companies, internet service providers and civil society — has been lauded across Capitol Hill as a model way to vet and develop new proposals,” he wrote in The Hill. “It’s time for Congress to close the streaming loophole.”

Given all of the circumstances and developments of the last decade, particularly considering the rise of legal and illegal streaming, the environment today is literally and figuratively years apart from SOPA. As a result, it arguably presents the perfect opportunity for Congress to deliver.

From: TF , for the latest news on copyright battles, piracy and more.

The US Senate’s Judiciary Subcommittee on Intellectual Property is looking for ways through which it can better address online piracy.

Specifically, it’s working with various stakeholders to see if the DMCA can be improved to better suit today’s online environment.

The effort, announced by Senator Thom Tillis last year, partly overlaps with the Copyright Office efforts to improve the DMCA. That process has been running for years and the findings and recommendations were recently summarized in an advisory report , which suggested several ‘tweaks’ to the current law.

The Senate Subcommittee is aware of the overlap and sent a letter to the Copyright Office, asking for clarification and guidance on some key issues. The answers, which came in last week, provide further detail on how the Copyright Office would deal with some of the main stumbling blocks.

Repeat Infringer Requirements

The DMCA currently requires ISPs that want ‘safe harbor’ protection to “adopt and reasonably implement” a repeat infringer policy that terminates accounts of repeat infringers “in appropriate circumstances”.

This repeat infringer issue is at the center of several high profile lawsuits against ISPs and recently resulted in a billion-dollar damages award against Cox . It is not without controversy, however, as the law leaves a lot of room for interpretation. What’s “reasonable” and “appropriate” isn’t clearly defined.

In answer to the Senate Subcommittee, the Office stresses that there should be some minimum requirements for all service providers. However, size matters. This means that larger services with more resources could be held to a higher standard. For example, by preventing infringing content from reappearing.

This ‘reappearing’ angle hints at a filtering requirement, something the Copyright Office advised against in its report. While that may sound worrying to some, the Office also has some reassuring suggestions for average Internet users.

Not All Infringements are Equal

The Copyright Office notes that not all copyright infringements are equal. This is something that could be taken into account when deciding whether a repeat infringer should be terminated. A YouTube user who uploads full-length films will cause more harm than someone who uses part of a song as background for a homemade video, for example.

“Therefore, the number of notices in any particular repeat infringer policy that should reasonably result in account termination or other adverse action will likely be lower in the former case than in the latter,” the Copyright office writes.

“Thus, while there should be certain minimum standards addressing repeated acts of infringement, an evaluation of the reasonableness of those standards may vary depending upon individual factors in the case, including the OSP’s size and resources, the nature of the service, and the nature of the infringement itself.”

Disconnections Are Not Always ‘Appropriate’

The Copyright Office is clearly mindful of individual user rights. This is also true for potential Internet disconnections of accounts that are repeatedly used to share pirated content. Following recent court rulings, ISPs have become more strict but the Office notes that disconnections are not always “appropriate.”

Terminating someone’s Internet access can have much more drastic consequences than terminating a social media account, the letter states.

“For example, the negative consequences that are likely to result from termination of a user’s internet service if there is only one local broadband provider is likely to be greater than the negative consequences that flow from having an account terminated on a social media site for which there are other ready substitutions.”

Throttling Pirates

These potential ramifications of account termination could play a role in what’s deemed appropriate. Congress may want to consider this if the DMCA is updated. Specifically, the Copyright Office suggests that other penalties such as bandwidth throttling could be preferred over hard disconnections in some circumstances.

“Congress may want to consider the adoption of penalties short of account termination, such as limiting bandwidth or slowing service speed, to address repeat infringers for certain users of section 512(a) services,”

This is an intriguing suggestion, especially in the light of ongoing lawsuits against ISPs over the “repeat infringer” issue.

The same letter also mentions other user rights, as Re:Create highlights . This includes protecting free speech from bogus takedown notices. Right now, it can take up to two weeks before content is restored after a false or inaccurate notification. That can be too long if it censors free speech.

Similar to the Copyright Office report, the letter is a mixed bag of notes and recommendations. Some are in favor of copyright holders and others are more beneficial to Internet services, or the public at large.

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A copy of the Copyright Office’s letter to Senator Patrick Leahy and Senator Thom Tillis is available here (pdf) .

From: TF , for the latest news on copyright battles, piracy and more.