National Efforts to Control the Internet: to Regulate or Not?

Giovanni Maria Riccio

E-Lex Law Firm - Italy

gmriccio@e-lex.it

Taxonomy

• What is regulation? What is innovation?

• According to the neoliberal paradigm regulation is only a good regulation

• The problem is how the regulation fits with the emerging business models

• Why we consider the regulation as a limit to the innovation?

Why companies innovate?

Successful innovation is normally a source of temporary market power, eroding the profits and position of old firms, yet ultimately succumbing to the pressure of new inventions commercialized by competing entrants

The Circle of Innovation

Disruptive Innovation

Lower performances

New performance features

Initially developed for small markets

Quality improves as the market/revenues improve

As the quality improves, the new products – offering new features – replace the older ones

Regulation may…

Support innovation

Limit innovation

Be indifferent to the innovation (and leave space to self-regulatory measures)

Supporting Innovation

• Interoperability and IoT technologies

• The necessity of using standardized technology is limited by existing patents

• SEPs (standard essential patents): patents which are essential to implement a specific industry standard

• SEPs grant patent holders a significant power towards other developers that cannot implement their inventions

Motorola Case EU Commission April – 2014

• According to the European Commission, IP rights are a crucial aspect of the Single Market, as they play a key role in promoting innovation

• The injunction made by Motorola against Apple is an abuse of a dominant position

• Motorola, holding a SEP, licensed on FRAND terms (fair, reasonable and non-discriminatory)

• Apple agreed to enter into a FRAND licence agreement

Limiting Innovation Uber Cases

• Madrid Commercial Court – Dec. 9, 2014 (Prel. injunction)

Uber doesn’t own the administrative authorizations required by the Spanish Law and by the Law of the Madrid Region and breaches the Spanish competition law of 1991

• Commercial Court of Bruxelles – Mar. 31, 2014

According to the SA Taxi Radio Bruxellois, Uber violates the unfair commercial practices as it offers its services lacking administrative authorizations

• German cases (Frankfurt, Hamburg, Berlin)

Again, administrative authorizations are required by the German Trasport Act - “PBefG”

Are these provisions complying with the EU Treaty?

• According to Uber, State measures infringe articles 102 and 106 of TFEU since they would create a monopoly that is unfavorable to the welfare of consumers

• Commercial Court of Paris (Dec. 12, 2014)

Submitted the question to the French Constitutional Court as well as to the ECJ

French Constitutional Court – Décision n° 2015-468 – May 22, 2015

Limiting Innovation (2)

• Article 180 of the Italian Copyright Law provides that the collecting management of copyright is reserved to the Italian society of authors and publishers (SIAE)

• The paradox after the CISAC decision: non Italians CCS can collect royalties in the Italian territory, which is forbidden to companies based within the Italian territory

• The EU Directive on CSS doesn’t affect existing monopolies

National Efforts to Control the Internet

The “battle” of copyright holders

• HADOPI Law

• AGCom Regulation

• Ley Sinde

Addressing ISPs, user generated platforms or users liability is the right (and most efficient) way to protect copyright?

Technical Solutions Rather than Regulatory Solutions

Two examples

Privacy by design

Attacking the money supply (so-called “follow the money approach”)

Follow the money

Privacy by Design and by Default

EU Data Protection Directive

• No specific rule addressed to privacy by design in the EU Directive

EU Data Protection Regulation

• Having regard to the state of the art and the cost of implementation, the controller shall implement appropriate technical and organizational measures and procedures in such a way that the processing will protect the rights of the data subject.

Thank You!

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