Digital Economy Act: High Court dismisses challenge

20 Apr 2011

The High Court has today dismissed a challenge to the lawfulness, under EU law, of the provisions of the Digital Economy Act 2010 aimed at requiring internet service providers (ISPs) to help reduce illegal ‘peer to peer’ file-sharing.

Under the Act, Ofcom must make a Code requiring ISPs to notify their subscribers of alleged instances of online copyright infringements, and to compile lists to allow copyright owners to identify repeat offenders. The Act also makes provision potentially to require ISPs to take “technical measures” against the most serious copyright infringers, such as to limit their use of, or even to terminate, their internet connections.

The challenge was brought by two major ISPs, BT and TalkTalk, who argued that the imposition of requirements on ISPs under the Act would breach EU law, because:

(i) the Act had not been notified in draft to the European Commission under the Technical Standards Directive;

(ii) the requirements would be incompatible with EU Telecoms Directives (including the E-Commerce Directive, the Privacy and Electronic Communications Directive, and the Authorisation Directive); and

(iii) the requirements were disproportionate in their impact on ISPs, consumers and others, and therefore breached EU law and the European Convention on Human Rights.

The Court rejected the challenge to the Digital Economy Act in full.  However, the Court found for the Claimants on one ground of challenge, which related not to the Act itself, but to proposed rules requiring ISPs (as well as copyright holders) to contribute towards Ofcom’s costs of administering the scheme.  The Court’s judgment means that, unless there is a successful appeal, the Government is free to press ahead with implementing the Digital Economy Act regime, subject only to making adjustments to the way Ofcom’s costs will be recovered.

The Claimants have not yet said whether they will seek permission to appeal against the judgment

Robert Palmer and Alan Bates represented the Secretary of State for Business Innovation and Skills (the Defendant).

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Robert Palmer
Alan Bates