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Canada Outlaws Settlement Threat Letters Sent Through ISPs


Somehow, it seems things move quite quickly in the Great White North. It was only in October that we discussed Canadian ISPs making a great deal of noise over the plague that is settlement letters sent to their subscribers over supposed copyright infringement. In the Canadian system, rightsholders pass along a letter to the ISP, which is then supposed to pass those letters along to the subscriber. ISPs began complaining that its own administrative burden was being repurposed as part of the copyright trolling business model, used to extract settlements purely out of fear. In November, ISPs got their wish, with a proposed law that would amend copyright law to outlaw these letters when they include these types of extortion attempts.

And now, in December, the law has officially passed, bringing an end to threat settlement letters sent to subscribers through their ISPs.

Bill C-86, the Budget Implementation Act, has now received royal assent, so there will be some big changes in the Great White North. Section 41.‍25 of the Copyright Act is now amended with the addition of the following;

(3) A notice of claimed infringement shall not contain:

(a) an offer to settle the claimed infringement; (b) a request or demand, made in relation to the claimed infringement, for payment or for personal information; (c) a reference, including by way of hyperlink, to such an offer, request or demand; and (d) any other information that may be prescribed by regulation.

The text is pretty straightforward, in that it prohibits demands for settlement in the notices themselves or on a third-party site where such a demand may also be available. This is important since some notices contain hyperlinks that not only lead to demands for cash but also undermine subscriber privacy with the use of tracking code.

Now, rightsholders can still send these letters on their own, assuming they can use the courts to unmask ISP customers. They can also include all the offers of settlement they wish. But that's nearly besides the point, since the math in the copyright trolling business model only really works if the troll can get the ISP to act as its clearinghouse. If trolls have to do all of this heavy lifting in unmasking customers and sending these letters out on an individual basis, that changes things dramatically.

It hasn't gone unnoticed, however, that ISPs are still the enforcement wing of this new law.

However, Geist also cautions that the new amendments contain no punishments for anti-piracy companies that fail to follow the rules.

“The key remaining question is whether ISPs will crackdown on non-compliant notices. Since there is no penalty associated with sending non-compliant notices, subscribers are dependent upon ISPs carefully reviewing notices to ensure that they only forward those that fully comply with the law,” Geist notes.

One expects this to be something of a selling point for Canadian ISPs. If they don't have plans to tout their plans to strictly comply with the new law in favor of their customers, they really should have their PR and Marketing folks getting on this with haste. What Canadian citizen is going to want to get internet service from a company that is too lazy to protect its customers by complying with the law?


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