New Regulations Govern UK Web Hosts, ISPs

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New Regulations Govern UK Web Hosts, ISPs
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Adam Eisner, theWHIR.com
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August 23, 2002 – Web sites and hosting
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firms in the United Kingdom now have a new set of specific
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accountabilities to consider after new e-commerce regulations were
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introduced this week.
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The regulations, part of the Electronic
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Commerce (EC Directive) Regulations 2002, address several issues
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surrounding Web hosting in the UK, including site content and tax
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regulations. They were published by the government last week, a little
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less than two weeks before they became law. The directive is based on
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the European Union E-Commerce Directive.
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The overall aim of the EU’s directive is
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to break down potential legal barriers against e-commerce use across
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Europe by declaring the responsibilities and rights of both businesses
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and consumers. The regulations were also designed to promote the free
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flow of information across Europe, and to protect companies that
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operate networks where it is impossible to track all the information
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being exchanged between servers and users.
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In the United Kingdom, where the
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regulations were slightly altered before becoming law, Web hosting
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firms and ISPs are now responsible for ensuring a number of conditions
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are regularly enforced. One of the most significant obligations for UK
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Web sites surrounds the UK Value Added Tax, or VAT for short. As of
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August 21, Web sites hosted in the UK that sell goods or services are
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required to include an e-mail address, geographical address and VAT
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number where necessary. What’s more, any prices listed on a Web site
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hosted in the UK must now clearly indicate whether they include both
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VAT and delivery costs.
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Web sites must also acknowledge the
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receipt of any orders placed online without delay. “A service provider
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shall acknowledge receipt of the order to the recipient of the service
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without undue delay and by electronic means,” regulation 11(1)(a)
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states, and “make available to the recipient of the service
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appropriate, effective and accessible technical means allowing him to
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identify and correct input errors prior to the placing of the order,”
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according to section 11(1)(b).
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The directive also aims to remove some of
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the ambiguities surrounding the removal of third-party content,
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declaring the onus will be on law enforcement authorities to prove that
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a service provider was aware of the content before being held liable.
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According to the directive, service providers act as a “mere conduit”
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for the transfer of information so long as specific conditions are met.
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Much of this new clarity, particularly as
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it relates to the UK version of the regulations, is a result of efforts
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by the Internet Service Providers Association (ISPA). The ISPA has been
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lobbying feverishly for changes to regulations surrounding several
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issues, including legal implications when carrying or storing
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controversial content.
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The association, which was established in
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1995 and boasts an impressive membership list that includes BT and
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Level 3 Communications, has repeatedly said that solid definitions and
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provisions are required to inform service providers of what their
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responsibilities are when it comes to storing content that may be
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deemed illegal for one reason or another. Failing to do this, the
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Association argued, could have grave implications for Web hosts.
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“Unless there is an effective and
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legally certain notice and takedown procedure agreed between all
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stakeholders, Web hosting in the UK could become unworkable and
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ultimately could deter Internet businesses from establishing themselves
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in the UK,” the Association said last year. “The E-Commerce Directive
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anticipates such a procedure and ISPA is committed to working with
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Government and other interested groups to achieve this aim.” The ISPA
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reportedly won several important concessions prior to the enactment of
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the directive, which makes them believe they have secured at least a
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partial victory thus far.
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Regulations like the EC Directive are
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necessary to guide companies in an age where legal precedents are few.
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They are also important, however, to protect consumers that may be
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vulnerable in a business area where a lack of precedent could affect
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them as well.
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The full text of the EC Directive is available at http://www.legislation.hmso.gov.uk/si/si2002/20022013.htm