BT And TalkTalk Appeal Digital Economy Act Judgment

BT and TalkTalk are seeking leave to appeal against a High Court ruling on the Digital Economy Act (DEA), handed down in April. The companies had asked the High Court for Judicial Review of the Act, arguing that elements of it breach requirements placed on national governments by EU law.

The High Court carried out a judicial review, but its ruling overturned only some of the DEA provisions about which BT and TalkTalk had concerns. The two companies now want the remaining areas of concern looked at by the Court of Appeal.

The Act received insufficient scrutiny before being rushed into law at the tail end of the last Parliament. The two companies argued that the resulting legislation prompted concerns about its overall impact and left a lack of clarity about its legal basis. As major internet service providers (ISPs), BT and TalkTalk felt obliged to seek clarity, in part to protect themselves in case any third party questioned the Act in future and had it overturned.

BT and TalkTalk believe that the DEA measures aiming to prevent online copyright infringement are inconsistent with European law. Quite apart from the potential impact on their businesses, BT and TalkTalk believe the DEA could harm the basic rights and freedoms of ordinary citizens. Many MPs of all parties, consumer groups and other communications providers share this view.

BT and TalkTalk sought to address their concerns about the Act through a judicial review launched in July 2010. A High Court hearing took place in March this year and a judgment was handed down on 20 April.

The High Court concluded that the Act was broadly compatible with EU law, except on the issue of whether ISPs can be required to contribute to costs which the regulator Ofcom will incur when it administers the regime brought into place by the Act. The High Court found that making ISPs pay toward these administrative costs was not compatible with EU rules about what communications companies can be required to pay for.

BT and TalkTalk welcomed this part of the judgment. Nonetheless, both companies believe the High Court’s conclusions on many of the other important and complex issues put before it were not robust enough to provide the certainty and clarity which the companies sought. This is why they are seeking leave to take the matter before the Court of Appeal.

The two companies have chosen to seek an appeal on four of the five grounds addressed in the initial High Court case. These relate to the EU’s Technical Standards Directive, the Authorisation Directive, the E-Commerce Directive and the Privacy and Electronic Communications Directive. BT and TalkTalk believe the DEA is not consistent with these directives.

The fifth area addressed in the initial High Court ruling concerned whether the Act was in accordance with EU rules on proportionality. Both companies continue to take the view that the regime represents a disproportionate interference with the rights of internet service providers, subscribers and internet users and with the concept of freedom of expression. They recognise, however, the Court’s view that there is an exceptionally high threshold to show that this legislation was not a proportionate response prior to the code of practice being published and have concluded not to pursue leave to appeal on this ground.

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