BT and TalkTalk to challenge Digital Economy Act

The Digital Economy Act was rushed through parliament before the election

TalkTalk and BT have filed legal papers at the High Court seeking a judicial review of the Digital Economy Act.

The companies hope to have the legislation repealed before it comes into force after what they claim was insufficient scrutiny when it was rushed through parliament in the pre-general election wash-ups.

Andrew Heaney, executive director of TalkTalk, told V3.co.uk that the action is necessary to provide "legal clarity and avoid a situation where we spend tens of millions only for the Act to be later overturned".

Heaney added that TalkTalk is not sure whether any other ISPs or groups will join the action, but claimed that "many share our view".

Gavin Patterson, chief executive of BT Retail, also cited a lack of clarity in the Digital Economy Act, and questioned whether the proposed legislation is legally sound.

"It is disappointing that we feel the need to take action but we have no choice. We have to do this for our customers who otherwise run the risk of being treated unfairly," he said.

"Our dispute is not with the current government but with the previous administration which pushed this through without due process. We need clarity about whether this legislation is compatible with important EU laws."

Robin Fry, a partner at law firm Beachcroft LLP, explained that the ISPs hope to use a technicality in the laws surrounding the submission of the Act's provisions to Europe.

"It is likely that the challenge, if permitted, will revolve around the failure of the UK government to give a required three-month notification of the technical measures in the Act to the European Commission, and non-compliance with data privacy laws," he said.

"Member states are obliged to notify the Commission of proposed technical regulations, and to observe a three-month standstill period before the regulation is made or brought into force."

Furthermore, a key part of the new Act, drawn up as part of a draft proposal by Ofcom in May, concerns the fact that only ISPs with over 400,000 customers will be forced to keep records on customers' online activities.

Fry added that BT and TalkTalk could lose business if customers switch to smaller providers to avoid potential legal action.

"Any business operating a Wi-Fi or serviced internet network (such as coffee shops, hotel chains, public libraries, universities and conference centres) should be looking now at their exposure under the Act to police online copyright infringement," he said.

"If they're astute, they will switch away from the major operators by January in order to avoid the crippling bureaucracy that will be applied via the seven largest ISPs to anyone who provides internet access."

The move to challenge the legislation has been welcomed by other organisations.

"The Act was rushed through and is already working extremely badly. It threatens basic rights and large chunks need to be repealed," said Jim Killock, executive director of the Open Rights Group.

However, the Department for Business Skills and Innovation defended the Act, claiming that it "sets out to protect our creative economy from the continued threat of online copyright infringement".

"We believe the measures are consistent with EU legislation and that there are enough safeguards in place to protect the rights of consumers and ISPs, and will continue to work on implementing them," said a spokesman.