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The New Digital Economy Bill Explained

Featuring as part of a number of proposed new laws that were included in the Queen’s Speech in May, the Digital Economy Bill 2016 sets out plans for stronger support for new digital industries, establishing a world class, universal service obligation (USO) on broadband and mobile phone connections, reforming policies around data sharing in the public services spectrum and imposing more stringent regulations for direct marketing activity. The aim is to make the UK a “place where technology ceaselessly transforms the economy, society and government”.

But at a time when so much of UK law appears to be in a state of flux, how does the Bill propose to implement these changes and what are the implications for tech driven businesses?

In order to achieve these plans and cement the UK’s status as an innovator in digital provision, there are a number of key elements which target a range of areas within the digital economy.

Digital Services Access

The changes proposed by the Bill will provide every household in the UK with the right to high-speed broadband access. Currently, existing legislation for internet access requires that the public has access to internet at speeds of at least 28.8 Kbps, which is only equivalent to a basic dial-up connection. As part of the new changes, the Government is expected to enforce a minimum speed of 10 megabits per second, under a new broadband universal service obligation (USO). As with the landline telephone USO, there will be a cost threshold above which the most remote properties could be asked to contribute to installation costs.

Ofcom Regulation

The changes proposed by the Bill will provide the regulator Ofcom with more power to review the broadband speed, over time, to ensure that it is sufficient. Ofcom would have the new power to order communications providers to share data about any complaints and broadband speed, with the aim of giving the public greater transparency when choosing their provider. In addition, consumers would qualify for automatic compensation if anything went wrong with their broadband, while providers would be responsible for co-ordinating the process when customers decide to switch supplier.

Date Sharing and Privacy

Public sector debt currently sits at more than £24 billion and the Bill’s proposed new legislation aims to develop new systems for pinpointing and collecting money owed. A gateway will be established, enabling public authorities to disclose certain information to each other if required. Meanwhile, concerns that this could weaken the Data Protection Act 1998 have been dismissed by the Government, explaining that data would only be shared where there was a public benefit. A code of practice is in the process of development, defining appropriate use of the data. In terms of misuse, there will also be sanctions of a fine and up to two years’ imprisonment. Not only does this have the potential to ease public sector debt, it will also facilitate data sharing between central and local government to enable people to receive any benefits to which they are entitled. The move will help individuals manage their debt with the government, and make detecting fraudulent activity easier.

The topic of personal data in relation to direct marketing also forms a significant part of the proposed changes. If adopted, direct marketers would be obliged to follow the code, making it much easier for the Information Commissioner’s Office (ICO) to take more effective action and impose fines for misconduct.

Pornographic Content

The Bill also unveils plans for age verification on porn sites. A separate age verification watchdog could be created and given the power to punish adult sites that fail to check their visitors' ages. The regulator would then be required to publish guidelines about how sites ensure their users are aged 18 or older or risk being fined up to £250,000. Details of how this would work are yet to be determined, but the proposed legislation might enable the watchdog to alert credit card providers, as well as other companies providing a service to these sites in cases where it cannot itself influence compliance.

IP rights and piracy

Perhaps one of the most controversial changes featured as part of the Bill is the increase in sentences for digital copyright infringement. Despite much protest, the maximum prison sentence for such an offence would be increased from two to ten years.

The last Digital Economy Act 2010, following a Bill introduced by Lord Mandelson, contained contentious attempts to clamp down on piracy. These attempts resulted in several legal challenges.

The new Bill had its first reading in the House of Commons on 5 July 2016. A date is yet to be set for the second reading, where MPs will be given the first opportunity to debate the general principles and themes of the Bill. It will be some time before the Bill becomes law and its provisions are likely to change during its passage through Parliament.

This article is for general information purposes only and does not constitute legal or professional advice. It should not be used as a substitute for legal advice relating to your particular circumstances. Please note that the law may have changed since the date of this article.

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