Royal Assent received for the Digital Economy Act 2017

26 May 2017

New legislation introduced to extend digital connectivity, regulate direct marketing and protect consumers from unexpected phone bills and ticket bots.

The Digital Economy Act 2017 (Act) has officially made its way into UK law. The Act addresses some of the many issues arising in conjunction with the surge in use of technology, digital media and online services, hoping to “modernise the UK for enterprise” and provide greater protection for consumers.

The Act addresses a real mixed-bag of topics. The main provisions are summarised below, including changes to:

  • consumer protection provisions (minimum broadband speeds, clampdown on ticket resales, mobile phone bill capping and the new social media code);
  • telecoms regulations;
  • online piracy regulation;
  • public sector data sharing;
  • charges to data controllers; and
  • a new code of practice for direct marketing.

Consumer protection provisions

The new legislation aims to tackle an issue dear to most consumers’ hearts, promising “every household a legal right to request a fast broadband connection” through the introduction of a minimum broadband speed of 10 megabits per second by service providers.

In an ambitious attempt to end the epidemic of ticket touts earning up to thousands of pounds on resale websites, the Act has authorised the Secretary of State to introduce regulations specifying a limit on the number of “recreation, sporting or cultural event” tickets a purchaser may buy with the intention for reselling such tickets online, and to issue fines to individuals in breach of the regulations.

Mobile network operators are now also obliged to offer a bill capping facility, in an attempt to prevent unexpected “shock” charges to consumers.

Other significant consumer-friendly provisions include a new “social media code” providing guidance about “how social media providers should respond to harmful behaviour such as bullying”, the introduction of civil penalties for online pornographers who do not verify the age of their customers and rules obliging internet service providers to block non-compliant sites.

Telecoms regulations

There have been considerable changes to the current Electronic Communications Code. The changes make it much easier for telecoms operators to install, assign, share and upgrade electronic communications apparatus such as masts and cables. The changes are certainly not “landowner friendly”, and attempt to limit the consideration and compensation payable to landowners for the use of their property.

Thekla Fellas, our telecoms specialist, will be publishing a more detailed article and hosting a series of seminars about the new Code. If you are interested please let us know.

Online piracy – clampdown

For those guilty of “communication to the public” of copyrighted content, the term of imprisonment has increased from two years to ten. The Act appears to target individuals and businesses selling TV-piracy boxes, rather than those who stream copyrighted content.

This issue has also recently been debated before the European Court of Justice, which ruled that: “the sale of a multimedia player which enables films that are available illegally on the internet to be viewed easily and for free on a television screen could constitute an infringement of copyright”.

The successful video media player “Kodi” has denied that its software application is in breach, arguing that it takes no responsibility for those who use third party plug-ins and add-ons to stream pirated content to their TV. It appears that this is still very much a grey area of law.

Public sector data sharing and charges to data controllers

The Act has also introduced powers of sharing personal data for “specified persons” such as public authorities including water, gas and electricity companies. It is hoped that the extensive sharing powers will help service providers to produce more tailored policies and services, developed from current and relevant information about individuals. The Information Commissioner’s Office (ICO) has commented:

“The Commissioner recognises the potential benefits of justified and proportionate data sharing but it is important that any provisions that increase data sharing inspire confidence in those individuals who will be affected.”

Charges payable by data controllers to the ICO appear to have resurfaced under the new legislation. This follows the recent, rather redundant, abolition by the General Data Protection Regulation (GDPR) of the requirement, under the Data Protection Act 1998, for an annual notification fee to be paid by data controllers.

Direct marketing – code of practice

Finally, under the Act, a new statutory code of practice will be introduced by the ICO “to promote good practice in direct marketing”, in line with the Privacy and Electronic Communications Regulations. The ICO has indicated its intention to address key issues such as time limits and consents to marketing from third parties, following more than 160,000 reports from the public about nuisance calls and texts in the past four years.

This coincides with new rules coming into force next year under the GDPR, and will affect an enormous number of businesses currently using “opt-in” and “opt-out” methods as a form of consent to passing on information.

Whilst many of the changes have not been well received and concerns surrounding privacy and confidentiality have been raised, particularly in respect of the new data sharing provisions, the legislation is at least a definite progression towards eliminating some of the evils associated with digital technology, and hopefully a better-protected online community.

Eddie Powell Author
Eddie Powell
Partner
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Michelle Waknine Author
Michelle Waknine
Associate
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