| All laws are prima facie
territorial (American Banana Co. v. United Fruit Co., 213 US 347, 357 (1909)).
International computer networks like the Internet subvert a system of rulemaking based on
territory. They affect the link between geographic location and
1. the power of local governments to control behavior;
2. the effects of behavior on individuals and things;
3. the legitimacy of the effort of a local sovereign to enforce rules applicable to
global activity; and
4. the ability of physical location to give notice of which set of rules applies.
Therefore, when considering Internet activities, it is essential to deal with
international implications. This article outlines a few of the relevant issues.
Regulation of systems
The construction and use of telecommunications networks is regulated by national
licensing. The Internet infrastructure, a network of networks, is regulated by such
licenses. A network may also be subject to licensing under national mass communication
laws. These laws are generally concerned with the regulation of services, content and
concentration of ownership.
As Internet services become more akin to television programming, the likelihood of the
application of these laws increases (See UK Broadcasting Act, 1990, ¤46).
Network authorization can depend on the nature of the traffic carried. Regulation of
networks carrying audiovisual traffic, like cable systems, differs from those of digital
data networks, such as the Internet.
Even within the U.S., different regulations apply to the provision of specific types of
traffic. Before 1996, cable companies were not allowed to carry voice traffic, and
telephone companies were excluded from providing audiovisual services (U.S.
Telecommunications Act, 1996).
Rules affecting content
Laws affecting content seek to safeguard societal interests and national security, with
obscenity laws and prohibition of seditious speech, or to protect private rights, such as
copyright. Trading considerations are also present, such as European requirements for a
minimum percentage of European-origin broadcasting, partly to protect domestic industries.
 Local
standards. Standards on obscenity and the depiction of violence differ from
country to country, and even from state to state. In U.S. v. Thomas (74 F 3d 701 (1994)),
an “amateur action” bulletin board operating out of Milpitas, Calif., was held
to violate “contemporary community standards” of Memphis, Tenn. The operators
were convicted on federal charges of transmitting obscene images across state lines.
Private
rights. Private rights affecting content are important to Internet service
providers and users. The scope and duration of these rights vary, as do their
effectiveness in specific circumstances.
Confidentiality
and trade secrets. The protection of confidential information may be
distinct from protection of a trade secret, or, as in England and some other
jurisdictions, trade secrets may be protected as confidential information. Both require
that the information is kept secret, which can be difficult on the Internet.
Even where secrecy is not perfect, information may continue to be
“confidential.” In Attorney General v. Guardian Newspapers (no. 2) ((1990) AC
109 at 260F), despite widespread publication of information outside Britain, it proved
possible to restrain publication in Britain.
Unfair
competition. Multi-jurisdiction Internet operation lacks unfair competition
restrictions. Unlike U.S. law, neither English nor Australian law recognizes unfair
competition. However, the German Unfair Competition Act prohibits a wide range of unfair
commercial practices (Kohl KG v. Ringelhan & Rennett AS (Case 177/83) 1984 ECR 3651).
Marks.
Internet domain names act as both addresses and identifiers of web sites, associating a
site with the owner and its product. They often include trademarks. Unlike traditional
trademarks, domain names cannot co-exist within the same generic top level domains (gTLD),
namely .com, .org or .net, administered by InterNIC. This creates conflict between the
domain names system, operated on a first-come, first-served basis, and trademarks.
While trademarks can be protected, there is no recognized right to a domain name per
se. The U.S. Patent and Trademark Office only registers domain names that are trademarks.
Use of a domain name may be prevented if it infringes trademark or creates unfair
competition or confusion in the market (Cardservice International Inc. v. McGee, 950 F
Supp 737 (ED Va 1997)). A successful claimant to an Internet domain name in one
jurisdiction will have an international exclusive right to the name due to the scope of
the Internet. But, a domain name registrant may not be immune to suit in a territory where
the name is another’s trademark.
Copyright.
International copyright conventions extend national protection to works of foreign origin,
creating different rights in the same work.
Public performance rights will gain importance as audiovisual works become widely
available on the Internet. Public accessibility of such works on the Internet can
constitute a public performance of the work, even if the material is only available to a
limited number of paying subscribers who request the material at different times. In the
analogous case of pay-per-view cable services, courts in many jurisdictions have held
public access to material amounts to “public performance.”
Protection
of databases. Creation of rights in databases, over and above the copyright
that exists in the arrangement, is still debated. The European Commission Database
Directive provides some measure of protection for electronic databases, with rights
against unauthorized extraction or re-utilization of the data (Dir. 96/9 (Council
Directive on Legal Protection of Databases) 1996 OJ L77/20).
Privacy laws and trans-border data flow regulations also limit the use of databases.
Moral
rights. Civil law countries, the European Union, India, Switzerland and
others, grant to the creator inalienable moral rights which prevent unauthorized
distortion or modification of his work. Consequently, an assignee of copyright may not
enjoy all the rights to the work in some jurisdictions.
This raises a serious issue for Internet providers, particularly interactive web sites
where the user can manipulate the work by coloring and adding figures or sounds.
Defamation.
There is wide variation between jurisdictions as to whether a statement is
defamatory, and in who is liable for defamatory statements (Stratton Oakmont Inc. v.
Prodigy (NY 1994) held Prodigy to be a publisher of defamatory posting on its bulletin
board). Nor is it easy to ascertain what constitutes publication.
There are also differences in the rules establishing jurisdiction over a defendant. To
avoid potential defamation claims, awareness of the prevailing standards in all
jurisdictions in which the material is accessible is essential. The author, editor,
publisher of the statement and others might be liable.
Disclaimers
Notices aimed at reducing liability for content are common, either by declaring that
the material is not intended for viewing in particular jurisdictions or by disclaiming
liability for the content. There is no U.S. decision that liability for a foreign web site
can be avoided by declaring that it is not intended for access in the U.S.
The information provider cannot be confident of the effectiveness of a disclaimer
without considering the relevant laws of each country. For example, English law limits the
application of disclaimers not negotiated at arm’s length. French law requires all
terms of a consumer contract to be in French.
Jurisdiction
U.S. jurisdiction may be established by purposeful contact with residents of another
state, including Internet-service advertising, transmission of e-mail or provision of
passwords. (Zippo Manufacturing Co. v. Zippo Dot Com Inc., 1997 U.S. Dist LEXIS 107.)
The U.S. minimum contact standard (International Shoe 326 U.S. 310, 316 (1945)) is not
met by unilateral act of others (Hansen v. Denc-kla, U.S. 235 (1958)).
In Asahi v. Superior Court (480 U.S. 162 (1987)), the placing of a product in the
stream of commerce was not sufficient to establish a basis for jurisdiction.
Other jurisdictions may have different standards.
Sa’id
Mosteshar of Mosteshar Mackenzie, with offices in San Diego and London, practices
communications law and space law. He is an advisor on the executive committee of the
International Law Section. |
