3. Section 4 ISP Liability
3.1 Definition of Internet Service Provider
Submission: The Committee agrees that the definition should be based on the activity rather than the organisation.
3.2 Transient Copying and Caching
Submission: The Committee agrees with the Ministry's proposals relating to transient copying and caching.
3.3 Secondary Infringement
Submission: The Committee has not formed a final view as to whether an actual knowledge or constructive knowledge test should apply. The Committee notes that many New Zealand ISPs are relatively small and may not have the resources to have constructive knowledge attributed to them. By this the committee means that they may be too small to be forced to spend money on achieving a sufficient level of expertise to understand when they might be caught by a test that requires them to understand whether a particular action constitutes infringement. For large ISPs, it may be unrealistic to require ISPs to monitor that is on or goes through their servers.
However, it has been suggested that ISPs should have obligations where an issue has been brought to their attention (e.g. to investigate, seek advice, or take action to remedy), even where the ISP is not sure whether there is a breach.
It has also been suggested that small ISPs need to have some body to which they can have recourse as an initial low cost adjudicator to provide a decision/advice on whether in fact the alleged act might constitute infringement, and that an online service modelled along the lines of the WIPO e.g. might assist in this regard. An ISP faced with an alleged infringement could then take comfort from a ruling of such a body in "taking down" or not "taking down" as the case may be, the material in question (or, if a constructive knowledge test applied, a ruling from such a body could be considered when evaluating whether the ISP had "reason to believe" that an act constituted an infringement). In the UK the Internet Watch Foundation performs a function along these lines with respect to illegal pornography and racist materials. The foundation is supported by ISPs and interacts closely with them. This model could be used for copyright infringement alone, or preferably, in conjunction with notice and takedown procedures covering a range of alleged infringements - see comments under 3.4 below.
3.4 Other Comments
Submission: The Committee's view is that ISP liability should be dealt with "horizontally" so that a scheme is introduced which covers all types of potential liability for their party actions and not just copyright. Discussion of the different approaches can be seen in the WIPO paper Intellectual Property on the Internet: A Survey of Issues at paras 74-81.
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