Government clueless over copyright costs

Parliament is under pressure to pass the Digital Economy Bill before the next General Election

The government has no idea how much impending copyright legislation is likely to cost the UK economy.

The economic assessment for the Digital Economy Bill, released yesterday, does not give details on the cost of implementing Clause 18, a controversial method to stem piracy, proposed by the House of Lords last week.

Clause 18 will force ISPs to restrict access to web sites that host copyrighted content or those that make copyrighted content easily accessible to file-sharers. Critics have argued Clause 18 would hinder freedom of expression, competition and innovation.

The government is in such a rush to pass the Digital Economy Bill before the next general election that it is likely to only get two readings in the House of Commons before it heads for the “wash-ups” -- a period when Bills yet to be passed are speedily debated behind closed doors before parliament dissolves.

The Bill received its first reading in the House of Commons on Wednesday, two days after it emerged from the House of Lords. The government is obliged to give a full impact assessment of all potential legislation as it moves from one House to the other.

“The clause has not been subject to prior consultation and due to the limited time between the introduction of the clauses and the finalisation of the impact assessment, it has not been possible to assess the impact of these costs and benefits,” said the Department of Business, Innovation and Skills’ revised economic impact assessment.

“Those who might be affected by the provision include copyright owners, ISPs, web sites and other web service providers and consumers,” it continued.

The 324-page document said an initial look at the Clause had raised significant cost issues relating to ISPs and communication service providers because of the expense involved in blocking web sites and the costs to businesses and subscribers who use the web sites as part of their legitimate business.

The government also acknowledged there will be economic damage caused to the owners and operators of the web sites concerned, and there will be legal costs in seeking to contest the High Court action, both to the owners and operators of the web sites and to the ISPs, as well as to the court system itself.

“This is an entirely new measure to tackle online copyright infringement and as set out above, information on the nature and level of the costs and benefits involved is not available at this stage,” the BIS document concluded.

The lack of economic impact assessment regarding Clause 18 could be because the government may change the clause completely.

The House of Lords voted through Clause 18 because they were worried about the implications of Clause 17, which is supported by the Labour Party and would give future ministers the power to introduce new rules without prior parliamentary scrutiny.