Australia: Amendments to Copyright Act will strengthen copyright holders' rights online

Last Updated: 3 July 2015
Article by John Collins

Most Read Contributor in Australia, August 2016

Until now there has been no efficient mechanism for copyright owners and exclusive licensees to block access to online locations based overseas that encourage copyright infringement. The Copyright Amendment (Online Infringement) Act 2015, which commenced on Friday, introduces new laws to give rights holders who discover infringing material online a way of requiring carriage service providers (CSPs) to take reasonable steps to block access to the content, via an injunction from the Federal Court.

Some changes recommended by the Senate Legal and Constitutional Affairs Committee have been adopted, which rights-holders and CSPs alike need to understand.

The new website blocking regime at a glance

Under the newly amended Copyright Act, a party may apply to the Federal Court to grant an injunction to require the CSP to take reasonable steps to disable access to an online location.

The Federal Court will only grant the injunction if it is satisfied that:

  • a CSP provides access to an online location outside Australia;
  • the online location infringes, or facilitates an infringement of, the copyright; and
  • the primary purpose of the online location is to infringe, or to facilitate the infringement of, copyright (whether or not in Australia).

Similar mechanisms are already in force in several European Union member countries, including the United Kingdom, where several copyright infringing websites have been blocked since the legislation came into effect.

Important changes made to the website blocking regime after industry consultation

After an extended period of review, the Senate Legal and Constitutional Affairs Committee recommended passing the Bill, subject to several recommendations which have now been adopted.

Primary purpose test was clarified in relation to advertising and VPNs

Under the Bill, an online location could only be blocked if was found to have the "primary purpose" of infringing or facilitating the infringement of copyright. The EM now clarifies the meaning of the phrase "primary purpose" in two important ways.

  • First, a website may have the "primary purpose" of copyright infringement even if the main object of the website owner is to profit from advertising.
  • Second, VPNs are not captured by the "primary purpose" test. VPNs allow users to securely access a private network as if they were sitting at a local computer on that network, and access public networks like the internet from there. VPNs are excluded from the new laws because VPNs can be used for legitimate purposes or used to access legitimate copyright material distributed in a foreign geographic market.

Blocked website landing page

The Bill provided no details of what would appear in the place of the blocked website. The EM now clarifies that once the CSPs have blocked a website the parties may also be required to post a landing page on the blocked website, giving notice of the court order that required access to the page to be blocked.

Costs and liabilities of CSPs

The Bill was unclear about the scope of CSPs' liability. The EM now indicates that:

  1. CSPs will only be liable for the cost of court proceedings where they decide to participate in the process;
  2. since the CSPs will be obeying a Federal Court order in providing the account information they will have no liability in relation to claims brought against them in relation to their disclosure of that information; and
  3. the court may allocate the costs of blocking the website incurred by CSPs to the copyright owners.

Factors for the court to consider

In addition to these changes, the Bill was amended on 16 June 2015 by making the list of factors to be considered by the court when granting an injunction discretionary, rather than mandatory.

How have CSPs responded?

Communications Minister Malcom Turnbull has stated that the costs incurred by CSPs to block the website will be "relatively modest". However, the telecommunications industry body Communications Alliance has expressed concern about what it considers to be a high level of uncertainty around the costs of the scheme. Those costs may ultimately be passed onto consumers.

Although CSPs will only bear the cost of the court proceedings if they are involved in those proceedings, it is not clear how they can effectively raise any argument about the proposed blocking or their costs without being involved in the court process.

When did the legislation come into effect?

The legislation came into effect on 26 June 2015. Websites that have the "primary purpose" of infringing or facilitating the infringement of copyright are now liable to be blocked by an injunction of the Federal Court on application by copyright rights holders. We expect there will be activity in the coming months as rights holders rush to exercise their new rights under these laws.

There is no limit on how many websites can be listed in an application, meaning that copyright owners can apply to have multiple websites disabled at once.

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Clayton Utz communications are intended to provide commentary and general information. They should not be relied upon as legal advice. Formal legal advice should be sought in particular transactions or on matters of interest arising from this bulletin. Persons listed may not be admitted in all states and territories.

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