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Free speech on the global internet : the role of e-commerce Khangura, Harinder Singh 2001

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Free Speech on the Global Internet: The Role of E-Commerce by Harinder Singh Khangura B.Sc., University of Toronto, 1997 A THESIS SUBMITTED IN PARTIAL F U L F I L L M E N T OF T H E REQUIREMENTS FOR THE DEGREE OF Master of Science in THE F A C U L T Y OF G R A D U A T E STUDIES (Department of Computer Science) We accept this thesis as conforming to the required standard The University of British Columbia October 2001 © Harinder Singh Khangura, 2001 In presenting this thesis in partial fulfillment of the requirements for an advanced degree at the University of British Columbia, I agree that the Library shall make it freely available for reference and study. I further agree that permission for extensive copying of this thesis for scholarly purposes may be granted by the head of my department or by his or her representatives. It is understood that copying or publication of this thesis for financial gain shall not be allowed without my written permission. Department of C P ^ I A / ^ C i e r \ C 6 The University of British Columbia Vancouver, Canada Date . Abstract The Internet has truly become a worldwide phenomenon in recent years, with more and more countries coming online every day. The new global economy that the Internet enables is the main catalyst behind this embrace of the Internet by even the most closed societies. However, the wide variety of material available on the Internet presents a problem for legislators all over the world, and as a result a broad range of free speech policies have been adopted by governments. The focus of this thesis is to find possible relations between the e-commerce concerns that a particular country has and the free speech policy that it chooses. Having these relations can help to predict how a free speech policy will change over time. The thesis starts with a description of blocking and filtering, as that is central to the free speech policies in many countries. Next, a survey of the free speech policies and e-commerce statistics for countries from all major regions of the world is presented. This data is analyzed to determine how e-commerce concerns can affect the free speech policy of a country. Finally, trends on how free speech policies can change over time due to economic factors are outlined. ii Table of Contents Abstract ii Table of Contents iii Acknowledgements vi 1 Introduction 1 1.1 Free Speech and Censorship 2 1.2 E-Commerce 4 2 Blocking And Filtering 5 2.1 Introduction 5 2.1.1 Private Blocking 5 2.1.2 Filtering 7 2.2 Problems with Blocking/Filtering 9 2.2.1 COPA Commission 10 2.3 Filtering Legislation 11 2.3.1 Legal Positions on Filtering in the U.S. 11 2.3.2 Filtering Around the World 15 2.4 Summary 16 3 Survey Of Countries 17 3.1 Introduction 17 3.2 Asia 18 3.2.1 China 18 iii 3.2.2 Hong Kong 23 3.2.3 India 25 3.2.4 Malaysia 27 3.2.5 Pakistan 28 3.2.6 Indonesia 29 3.2.7 Singapore 30 3.2.8 Philippines 31 3.2.9 South Korea 32 3.2.10 Sri Lanka 33 3.2.11 Vietnam 34 3.2.12 Russia 34 3.3 South America 35 3.3.1 Argentina 35 3.3.2 Brazil 36 3.4 Middle East 37 3.4.1 Saudi Arabia 37 3.4.2 Israel 38 3.4.3 Iran and Iraq 39 3.4.4 Jordan 40 3.5 Africa 41 3.5.1 Nigeria 41 3.5.2 South Africa 42 3.6 Australia 43 iv 3.7 Europe 47 3.7.1 European Union 47 3.7.2 Sweden 48 3.7.3 United Kingdom 49 3.7.4 Germany 50 3.7.5 France 53 3.7.6 Spain 54 3.8 North America 56 3.8.1 Mexico 56 3.8.2 Canada 57 3.8.3 United States of America 58 3.9 Summary 61 4 Analysis 62 4.1 Introduction 62 4.2 Categories of Effect 62 4.2.1 Large Effect 63 4.2.2 Moderate Effect 65 4.2.3 Negligible Effect 68 4.3 Timeline of Control 70 4.4 Summary 72 5 Conclusions 74 Bibliography 77 V Acknowledgements This thesis would not have been possible without the guidance of my supervisor, Dr. Richard Rosenberg. He allowed me to form my own opinions, while always providing valuable insight and helpful pointers that were instrumental to the completion of this thesis. The second reader, Dr. Alan Mackworth, provided valuable feedback to help clarify my arguments. The support of my family during this time was tremendous. Even though they were thousands of kilometres away, it always felt like they were by my side. M y friends - from both ends of the country - made my time as a Grad student the most enjoyable years of my life. HARINDER SINGH K H A N G U R A The University of British Columbia October 2001 vi Chapter 1 Introduction The Internet has in its brief history been dominated by the more economically developed countries that were quick to embrace the technology; however, in recent years the Internet has truly become a worldwide phenomenon. Countries all over the world have acknowledged the importance of the Internet to their social, cultural, and most importantly their economic development, and have rushed to provide their citizens with basic access. The anarchic nature of the Internet in its present form presents quite a dilemma for most countries, as the wide variety of material available on the Internet does not always fit into their concept of socially acceptable discourse. Nations attempt to limit access to unacceptable content in a variety of ways, but this need to limit speech on the Internet must be carefully balanced with the desire to tap its economic potential. This thesis outlines the above conflict in many countries around the world. In particular, it attempts to find a relationship between the e-commerce concerns that a country may have and the free speech policy that it chooses. Finding such a correlation is important as it can help to explain and/or predict how online speech policies will evolve over time. Intuitively, having a free and open Internet experience for the citizens of a particular country should be conducive to a thriving Internet marketplace, but how much these economic concerns affect free speech policies is not well understood. 1 The Internet is still a relatively new phenomenon on the global scene, and as such there has not been much scholarly work done in the areas that this thesis is interested in. Thus most of the research material for this thesis has been gathered from the Internet itself. Sources include reports published by organizations around the world, news reports, and other relevant web-sites. Many organizations such as the Digital Freedom Network (DFN), the Global Internet Liberty Campaign (GILC), and others have studied and described the free speech policies of countries in an attempt to lobby for keeping the Internet free. Reports published by such organizations mainly focus on censorship issues and do not generally, take the e-commerce landscape into consideration. The remainder of this chapter is devoted to defining concepts central to this thesis: free speech, censorship, and e-commerce. Chapter 2 describes the types of blocking and filtering technology that is increasingly being mandated for use by Internet users, as well as the problems associated with this technology. Chapter 3 contains the survey of free speech policies and e-commerce outlook for a wide variety of countries throughout the world. This raw data is analyzed in Chapter 4 in order to determine possible relations between e-commerce concerns and online speech policy. The conclusions drawn are given in Chapter 5. 1.1 Free Speech and Censorship The right to freedom of expression has been recognized as a fundamental one for all citizens of the world. In fact, Article 19 of the United Nation's 1948 Universal Declaration 2 of Human Rights states: "Everyone has the right to freedom of opinion and expression; this right includes freedom to hold opinions without interference and to seek, receive and impart information and ideas through any medium and regardless offrontiers." [91] Free speech is the exercising of this right. Each type of media has its own issues with regards to free speech; so when the term is used in this thesis it is mainly limited to the exercising of the right to freedom of expression using the Internet. Whether this use is through e-mail, the world-wide web, or other Internet technology is not relevant. Censorship, as it pertains to this thesis, is the act of controlling the circulation of free speech. Censorship exists in some form in every country; no country has free speech in its purest form. Conflicting rights of individuals force the curbing of some kinds of speech. For instance, even the most open of societies would agree that individuals do not have the right to create and disseminate child pornography because it violates the rights of the children; so that particular type of speech is banned. As it pertains to the Internet, governments are most concerned with material such as 'obscene' speech, hate speech, and in many cases controversial political material. Censorship of this speech can take many forms, some of which are: passing Internet-specific laws criminalizing these types of speech, applying laws that exist in the off-line world to the Internet, using government portals to block access to restricted speech, and forcing citizens to use blocking or filtering technology. The extent to which governments restrict speech on the Internet varies widely, as will be discussed in Chapter 3. 3 1.2 E-Commerce E-commerce is a new phenomenon that has resulted from the rapid commercialization of the Internet in recent years. Strictly speaking, the definition of what constitutes e-commerce changes as new forms of doing business on the Internet emerge. For the purposes of this thesis: "E-commerce is much more than buying and selling on the Net: it is about doing business electronically, both within enterprises and externally, using computer networks and mobile communications." [75] There are many forms of e-commerce: business-to-business (by far the largest form presently found), business-to-consumer, consumer-to-consumer, and government-to-consumer. E-commerce is 'predominantly a business issue, enabled by information technology." [75] The ability to do business electronically has resulted in the development of new business models at a rapid pace; which models will prevail is still being decided. It is up to governments to facilitate e-commerce by providing the necessary infrastructure. This can take the form of laws protecting intellectual property, privacy legislation, as well as providing the basic communications connectivity to allow people to access the Internet. If and how governments change their Internet free speech policies to facilitate e-commerce is the focus of this thesis. 4 Chapter 2 Blocking and Filtering 2.1 Introduction Blocking and filtering regimes, in theory, allow users who do not want to be confronted with certain material, as well as agencies that want to prevent users from accessing specific classes of information, a facility to achieve that control. The material that people most want to avoid contact with are pornography, violence, hate, and in general anything that society deems unpleasant or threatening. With parents demanding a method to control the Internet access of their children, filtering and blocking technology has become a growth industry in many parts of the world. As outlined in the next chapter, many countries have invested large quantities of money and time into developing filters that cater to their world -view. While controlling the access of questionable material by children seems like a noble endeavour, there are serious flaws in current state-of-the-art filters, some of which will not be solved by advances in the technology. These problems are addressed below. 2.1.1 Private Blocking In private blocking solutions, companies compete to gather lists of sites that contain 5 possibly harmful material, and these sites are blocked from being accessed. The degree of granularity differs with different companies; some provide broad categories such as speech that is sexually explicit, violent, etc., while others provide narrower ones. This list of sites is seldom published, since it constitutes a "trade secret". This means that one rarely knows exactly what is being blocked; for instance, there have been cases where sites dedicated to criticizing blocking software have themselves been blocked. [68] This is one example of how crude the software is. This crudeness is particularly chilling when one considers that this type of software is increasingly being seen as a viable option for computers in public places (such as libraries and schools). The list of offensive sites is equivalent to the banned books of the past, but the list is unpublished! Placing blocking software in a public library is like taking books off the shelves in order to keep offensive material from children. [68] Placing the control of what is blocked and not blocked into the hands of companies with their own special interests is a questionable choice. The dynamic growth of the Internet means that these companies must keep up with the myriad of new 'objectionable' sites that appear. It is impossible to get them all, so this method of blocking is not particularly effective in practice. So although at first glance blocking software seems reasonable since we can choose whether to use it or not, we must be careful in how it is used. Companies have their own agendas which may or may not coincide with our own. Without full disclosure of what is being blocked, people cannot make an informed decision about whether the software suits their purposes. 6 2.1.2 Filtering The most basic types of filtering regimes are based on keywords. The program maintains a list of keywords that are not allowed to be shown to the user. Whenever the user attempts to access a web-site containing one (or a Boolean combination of) these keywords, they are blocked from doing so. This method of filtering is rather crude, since keywords are poor representations of the meaning of a web-page. Much more material is blocked by this type of filtering than desired; for instance sites dealing with sex education would be filtered out due to the mention of the word 'sex'. Sites concerned with teaching youth about anti-drug policies would be blocked because the filter would be unable to distinguish them from drug advocacy sites. Context can sometimes be taken into account, but only in a limited way; the end result is still to block much more content then one might have originally intended. [83] In an effort to provide a method to filter content by allowing the user to fully control what is filtered, a system of labeling called Platform for Internet Content Selection (PICS) has been developed. PICS is basically a general purpose language that enables separate labeling and filtering of content. In this way, there can be competition in the labeling as well as the filtering market. By separating the two, you ensure that rating systems will develop independently of filtering mechanisms. This gives neutrality in the sense that different individuals or groups can tailor the filtering that they require. For example, an organization which upholds Christian ideals may want to develop a rating system for people who hold similar ideals. Similarly, an organization that values freedom of access can develop a more 7 lenient rating system. It is this competition and specificity that makes the PICS system different from the crude blocking software that exists today. [68] Unfortunately, PICS is also neutral in a more dangerous way. It can be used at the level of a single user, in that he or she can use the rating system they choose on their personal machine, but it can also be used at other levels. For example, it could be used at the ISP level to restrict access to their clients. In the extreme case, it could be used at the national level to restrict access in the entire country. The PICS labeling system is general enough to be applied at any level, which means that the same feature which makes PICS desirable also makes it dangerous. [68] If widely adopted, this labeling system would fundamentally change the nature of the Internet. The Internet in its present form is extremely difficult (if not impossible) to regulate. With the addition of labeling and filtering of content, it all of a sudden becomes possible to regulate what people see, at the level of the user, the ISP, or even the country. With many countries not having the strong free speech protection of the U.S., the temptation for them to exercise this control would be irresistible. Another type of filtering which has recently gained notoriety is artificial intelligence based filtering. These filters presume to block explicit (i.e. pornographic) graphic images by analyzing the image and failing to display it if it is determined to be too explicit. While details of how this decision is made is unclear, it would seem to be based on the percentage of skin-tones in the image (with skin-tones implying nudity). Clearly this would filter an enormous amount of non-explicit material that just happened to have a large percentage of skin-tones. Initial tests of this technology have shown it to be horribly ineffective, with many explicit 8 photos not being blocked, and inappropriate blocking of non-explicit material. [54] 2.2 Problems with Blocking/Filtering Blocking and filtering technology is not mature enough at the present time to be trusted as the only method of blocking children's access to questionable material. The National Coalition Against Censorship offers the following descriptions of the limitations of filters: [14] - Oversimplification. How to distinguish "good" sex (or violence) from "bad"? Filters and labels assume that television programs and Internet sites can be reduced to a single letter or symbol, or a combination. - Overbreadth. Ratings and filters often ignore context and, thus, inevitably exclude material that users might want to have, along with material they may not want. - Feasibility. What about better descriptions of television programming and Internet sites? It sounds like a good idea, but it isn't currently feasible. There are thousands of television programs, content changes daily, and each new program would require a new description. The Internet is many times vaster, and the task of describing its contents is virtually unimaginable. - Subjectivity. Any rating system that classifies or describes content is dependent on the subjective judgment of the rater. Even if all participants voluntarily agreed to self-rate, which is highly unlikely, different raters would describe or rate the same content differently. - Full disclosure. Few Internet filters disclose what you lose by using them. The makers of 9 these products claim that information is proprietary and its disclosure would provide a roadmap to objectionable material. - Security. Filters and ratings give a false sense of security, by suggesting that all parents need to do to protect children is to block disturbing ideas and images. But this material, and the threats parents fear, exist in and out of cyberspace, and children need help learning to deal with them. 2.2.1 COPA Commission The Commission on Online Child Protection (the COPA Commission) was formed in the U.S. to evaluate the different solutions for protecting children from objectionable material on the Internet. The Commission was a result of the passage of the Child Online Protection Act (COPA), legislation which will be discussed in the next chapter. After evaluating a large variety of protection solutions, including blocking and filtering technology, the Commission concluded that: "... no single technology or method will effectively protect children from harmful material online. Rather, the Commission determined that a combination of public education, consumer empowerment technologies and methods, increased enforcement of existing laws, and industry action are needed to address this concern." [82] Furthermore: "Witness after witness testified that protection of children online requires more education, more technologies, heightened public awareness of existing 10 technologies and better enforcement of existing laws." [82] The COPA Commission was composed of a wide variety of people especially interested in the protection of children online. Their conclusion, that filtering alone will not solve the problem of preventing access to harmful material, deserves strong consideration. As we start advocating the use of blocking and filtering technology in public places such as libraries and schools, we must be acutely aware of the limitations of the technology, and avoid the feeling of security that the filter company will try to sell us. Use of filters in the home by parents should also be done with care; understand that the filter is a blunt instrument and cannot take the place of parental supervision and education of our children on what is appropriate online. Free speech is threatened whenever blocking or filtering is enabled, and we must be sure that preventing children from accessing objectionable material does not also impede on the rights of adults to access said material. If free and open dialogue is important in our society then we must be sure to implement solutions that are narrowly tailored to the protection of children, and do not unnecessarily hinder free speech. 2.3 Filtering Legislation 2.3.1 Legal Positions on Filtering in the U.S. The United States is the birthplace of the Internet, and this combined with the strong free speech protection that the U.S. Constitution provides means that Americans are usually the first to test the legal boundaries of new technology. In recent years libraries have started 11 providing Internet access to their patrons, and there has been a call for filters to be installed on these very public computers to ensure that objectionable material is not accessed by children, or displayed without consent to other library patrons. Two notable cases will illustrate how filters have faired under constitutional tests. The first occurred in Loudoun County, Virginia, in late 1997. The Board of Trustees of the Loudoun County Library adopted a 'Policy on Internet Sexual Harassment' which required that blocking software be installed on all library computers. [71] The blocking was required to ensure that child pornography and obscene material, as well as material deemed harmful to minors could not be accessed by library patrons. The blocking software was overbroad and blocked access to many non-obscene sites such as Yale University's biology deparment, the Zero Population Growth website, and many others. [55] Citizens of Loudoun County sued the Library Board with the help of the American Civil Liberties Union (ACLU) shortly after the Policy was enacted. District Judge Leone M . Brinkema ruled that the Library Board could not use the Policy any more and had to remove all blocking software from their servers. In her ruling she stated: "Adult library patrons are presumed to have acquired already the 'fundamental value' needed to act as citizens, and have come to the library to pursue their personal intellectual interests rather than the curriculum of a high school classroom. As such, no curricular motive justifies a public library's decision to restrict access to Internet materials on the basis of their content. We are therefore left with the First Amendment's central tenet that content-based restrictions on speech must be justified by a compelling 12 governmental interest and must be narrowly tailored to achieve that end. Accordingly, we hold that the Library Board may not adopt and enforce content-based restrictions on access to protected Internet speech absent a compelling state interest and means narrowly drawn to achieve that end." [71] The second case is in many ways the opposite of the Loudoun County case. In May 1998 a resident of Livermore, California identified simply as Kathleen R. sued the City of Livermore because her son was able to access sexually explicit material from library computers connected to the Internet. [61] There was no blocking or filtering technology used on the library computers, and Kathleen R. claimed that the library should have had a means to stop her son's access to the obscene material. The City of Livermore describes the complaint as follows: "The Complaint filed by Kathleen R. ('Plaintiff') requests injunctive relief against the City of Livermore ('City') '... preventing it or its agents, servants, and employees from spending any public funds on the acquisition, use, and/or maintenance of any computer system connected to the Internet or World Wide Web for which it allows any person to access, display, and/or print obscene material or for which it allows minors to access, display, and/or print sexual material harmful to minors. "' [61] In other words the suit wanted the library to stop receiving funding until it could stop the access of obscene and harmful material. Her lawyer, Michael D. Millen, suggested that the use of filters would be a good remedy. In January 1999, Judge George Hernandez dismissed 13 the suit without issuing an opinion. [74] So filtering at public government institutions was rejected in both cases because (as stated in the Loudoun decision) there was no 'compelling governmental interest' to justify content-based restrictions. In an effort to appease the popular misconception that the Internet is at the heart of many problems facing youth today, the federal government is attempting to provide the 'compelling governmental interest' that will lead to filters being used in most schools and libraries. In December 2000, Congress passed the Children's Internet Protection Act (CIPA), which requires all schools and libraries that want federal financial support to use filters to block obscene material and material deemed 'harmful to minors'. "The bill relies on established legal definitions for obscenity and child pornography, but offers its own definition of what sort of content is 'harmful to minors'. The bill defines this category as any picture or image that, "... appeals to a prurient interest in nudity, sex, or excretion ... depicts, describes, or represents an actual or simulated sexual act ... [or] lacks serious literary, artistic, political, or scientific value as to minors.'''' [90] The constitutionality of the CIPA will be tested in the courts, as a group consisting of the A C L U , the American Library Association, and others have filed lawsuits challenging the Act. [8] Governments at the local and state level have not been able to pass the legal test in their filtering policies; it will be interesting to see if the federal government is able to overcome this constitutional hurdle. 14 2.3.2 Filtering Around the World Many countries have requirements for ISPs to use filters, or central government blocking/filtering. For instance, Singapore funnels all Internet content through central government portals and uses blocking software to block about 100 sites (mostly pornographic sites). [70] The blocking is done based on web-site addresses, and the list is fixed. Vietnam has a similar system of relatively mild filtering. [59] Pakistan and Saudi Arabia both do central filtering as well. They filter for pornography, political content, anti-Islamic material, and other controversial content. [86,40] The method of filtering seems to be a combination of keyword-based filtering and blacklisting of specific sites. In Australia, ISPs are required to provide filters to their users from a list of government-approved filters. These filters were chosen not based on their effectiveness, but instead based on the fact that they included URLs provided by the government in their blacklists. [5] South Korea has recently passed legislation forcing filters to be used on all computers in public places, i.e. cyber-cafes, schools, and libraries. They seem to be using PICS or a PICS-like system to label content and then filter based on a government rating system. Furthermore, web-sites in South Korea are now required to label their content so that the filters will be effective. Interestingly since the legislation passed, sites protesting this new turn of events have been filtered out so that they cannot be accessed in public places. [64] 15 2.4 Summary Blocking and filtering technology is increasingly being seen as a solution to the 'problem' of controversial material on the Internet. Governments around the world are either using filters or considering legislation requiring filters for their citizens, many times without full knowledge of what filters can and cannot do. Using filters as a quick-fix will drastically affect free speech, and this must be well understood and very carefully thought out before implementation. The next chapter looks at a wide variety of countries in detail and outlines their Internet free speech policies as well as their e-commerce landscape. 16 Chapter 3 Survey of Countries 3.1 Introduction The first step in determining what, if any, relationships exist between e-commerce and free speech is to survey a wide variety of countries from all parts of the world. The survey consists of discovering the current free speech policy of each country, as well as the evolution of said policy. Lastly, the current and projected e-commerce landscape for the country is examined. Gathering e-commerce data and information on free speech policies is a difficult task due to the scarcity of reliable sources. As stated before there has been little scholarly work in the area that this thesis is concerned with, so one must turn to alternative sources to gather information. The first inclination would be to go to official government web-pages for each country, but this method rarely shows results. Most countries do not clearly state their free speech policies in an accessible place. Trying to contact someone within the government from their official web-pages through electronic mail is similarly futile. A lack of response is the most common result, but even when a reply is given it is not a clear statement of policy. The main sources of the following summaries of free speech policies were reports from agencies such as the Human Rights Watch, Digital Freedom Network, and others, as well as news 17 reports gleaned from various sources. E-commerce data was also found in news reports and web-sites that cater to international business concerns. Countries were chosen so that there would be representation from every major region of the world. Within regions where information gathering was more difficult (such as Africa and South America), countries were chosen mainly because information on both their free speech policies and e-commerce climate was attainable. In other regions where there was an abundance of information on many countries, they were chosen so that countries at different stages of Internet maturity were represented, i.e. ones that had embraced the Internet at different times and/or had a range of e-commerce revenue. Countries are grouped according to the continent they belong to, with the exception of countries in the Middle East which are grouped as a separate region. 3.2 Asia 3.2.1 China The Internet was slow to catch on in China due to the government's resistance to outside influences. Having originated in western democratic countries, the Internet was seen by the Communist government of China to be yet another vehicle for the encroachment of western ideals into Chinese culture. With the commercialization of the Internet and the ensuing economic gain experienced by other countries, China proceeded to embrace it. A cautious Chinese government made sure that all Internet service was funneled through government servers which blocked Western news sites, Chinese dissident sites, and other 18 material deemed objectionable. Despite these limits there were 100,000 Chinese citizens online in 1997, a number which has grown to 17 million at the end of 2000. If this rate of growth continues, China could have the largest online population within three years. [76] Initially there were no laws in China that specifically governed the Internet, however there were high-profile arrests for incidents involving the Internet. For instance, in 1999 computer engineer Lin Hai was sentenced to two years in prison for "inciting the overthrow of state power" after he provided 30,000 e-mail addresses to V.I.P. Reference, a Chinese pro-democracy e-mail publication produced in the United States. V.I.P. Reference sends its publication to hundreds of thousands of Chinese e-mail addresses in order to protect the identity of the true subscribers; anyone caught receiving it can claim they never requested it. [92] More recently in June of 2000, Huang Qi, the founder of China's first human-rights web site (www.6-4tianwang .com) was arrested for "subverting state power" after he posted articles criticizing the Tiananmen Square massacre of 1989. [76] The Communist Chinese government has a history of sacrificing human rights for political stability, and the Internet would not be allowed to escape its control. In January of 2000, the State Secrecy Bureau released its "Provisions on Secrecy Management of Computer Information Systems on the Internet". These regulations concern the transmission of "state secrets", which, while not fully defined in the legislation, seem to refer to any piece of information that the State Secrecy Bureau deems to be a state secret. Special permission must be given before any state secret may be transmitted or made available on the Internet. [78] 19 On October 1, 2000, the government released the "Measures for Managing Internet Information Services". This legislation requires that all commercial Internet Information Services (IIS) obtain a license from the Ministry of Information Industry (Mil) in order to operate. Non-commercial IIS do not need official licenses, but must report their services to the M i l for the official record. The measures also limit the amount of foreign investment allowed in an IIS. At present foreign investors are restricted to owning 49% of an IIS, but this number will rise to 50% in two years time. These limits are routinely bypassed by "pouring capital into offshore subsidiaries that the Chinese companies have set up in the Cayman Islands and elsewhere". [76] Article 14 of the Measures restrict an IIS from publishing news unless the news is from a state-run news site. This is an extension of existing rules on traditional print and television media that only allow state produced and sanctioned news items. Before these Measures, many web sites had an informal network of reporters that produced content; this is no longer allowed. [76] The Article requires an IIS to keep records of all content posted for 60 days. It also requires an ISP to record the time that its subscribers accessed the Internet, the subscribers' account numbers, the addresses of web sites visited, and the telephone numbers they use. These records are also required to be kept for 60 days. [76] These last requirements bring up many privacy issues, but are not surprising given China's policies in the offline world. From a free speech perspective, the most important part of the Measures are contained in Article 15: 20 '7/5 providers shall not produce, reproduce, release, or disseminate information that contains any of the following: 1. Information that goes against the basic principles set in the constitution; 2. Information that endangers national security, divulges state secrets, subverts the government, or undermines national unity; 3. Information that is detrimental to the honour and interests of the state; 4. Information that instigates ethnic hatred or ethnic discrimination, or that undermines national unity; 5. Information that undermines the state's policy towards religions, or that preaches the teachings of evil cults or that promotes feudalistic and superstitious beliefs; 6. Information that disseminates rumours, disturbs social order, or undermines social stability; 7. Information that spreads pornography or other salacious materials; promotes gambling, violence, homicide, or terrorism; or instigates crimes; 8. Information that insults or slanders other people, or infringes upon other people's legitimate rights and interests; or 9. Other information prohibited by the law or administrative regulations. " [76] These requirements are extremely broad and place great power in the hands of regulators. It is not clear if a search engine site would be liable for disseminating "pornography or other salacious materials" for simply returning the results to a user-entered search. This is an extremely restrictive policy towards free speech with regards to an IIS. Coupling these 21 restrictions with the fact that ISP's are required to keep records of user activity provides a means for the Chinese government to fully stifle any speech deemed objectionable. Before these Measures chat rooms were places of lively discussions, where the relative anonymity of cyberspace encouraged people to participate in political debate that they would not be privy to in the offline world. These new regulations apply equally to chat rooms, so this type of discussion is now outlawed. [76] The practical effect of the Measures will probably not be as drastic as one would initially assume. The Internet Information Services are well aware of the prevailing political climate that they operate in, and have practiced self-censorship even before these Measures were passed. Many web sites would shut down their chat rooms in advance of sensitive dates like the Tiananmen anniversary in order to avoid controversy. Even before the Measures, editors known as "Big Mamas" in Chinese removed posts that criticized the government from public bulletin boards. [76] In the end, the Measures are a means for the government to instill fear into citizens. The main objective is to deter people who would speak out against the government from doing so on the Internet. Past history suggests that these regulations will gradually stop being enforced as strictly once the government is satisfied that it has grabbed the attention of the citizenry. When fax machines and modems were first introduced, people required a license to own one; that law is ignored today. [76] Since the Measures were released, China has also released filtering software called Internet Police 110 that will help network administrators block objectionable material on the Internet. Officials have not as yet said whether the software would be mandatory or not. [79] 22 Also, recently a ban was placed on opening up new cyber-cafes, and as many as 6000 existing cyber-cafes were closed down for not having proper licenses. [16] E-Commerce Considerations The government agency in charge of the Internet, the Ministry of Information Industry, expected a volume of $42 million (U.S. dollars) in online shopping by the end of 2000. [24] This is a huge increase over the year before, and especially significant considering the slow access times that most online consumers face. As of mid-2000, "the Chinese government's ambivalent attitude towards the Internet - fearing the possibility of loss of control, but realizing the potential economic gain - has so far given precedence to the latter consideration." [24] With the release of the new "Measures for Managing Internet Information Services", it seems as though the focus has shifted towards regaining control of the Internet. 3.2.2 Hong Kong When China regained control of Hong Kong it committed to allowing Hong Kong to keep its capitalist system intact. As China has started clamping down on Internet freedoms, it is interesting to note that the Internet in Hong Kong has remained free. There is not any blockage of Internet sites at the government level, and there are no restrictions on ISPs to censor content. There is an existing law called the Control of Obscene and Indecent Articles Ordinance that, while not explicitly having the Internet mentioned as part of its jurisdiction, has been used to charge web-site creators with posting obscene content. [59] As a result, many of the major ISPs have started blocking newsgroups that contain obscene material. [86] 23 The government has begun a review of the Ordinance in April 2000, with the main focus to make the law explicitly applicable to the Internet. [28] The focus of the changes to the Ordinance may change, however, as the Internet grows in popularity. As recently as December 2000, lawmakers in Hong Kong were demanding more control over Internet content after an online publication showed a video clip of a journalist picking up a prostitute. [19] As it stands now, China has stood behind its promise to not impose restrictive laws on the people of Hong Kong. In terms of the Internet, China may be using Hong Kong as a test-bed for what can happen when Internet access is left unfiltered and for the most part unregulated. The Internet experiment in Hong Kong may influence how China treats the Internet in the future. E-Commerce Considerations The number of Internet users in Hong Kong has grown dramatically in recent years. There were 1.9 million people online at the end of 2000 (out of a population of 6.8 million), a number expected to grow to 4.0 million by 2004. Furthermore, according to the Information and Technology Broadcasting Bureau, the number of local Internet users making purchases online rose by 50% between October 1998 and October 1999. The e-business sector is extremely strong in Hong Kong, with the total value of products and services transacted over the Internet expected to grow from $60 million (USD) in 1998 to $1.3 billion in 2002, and $2.4 billion in 2003. To help this growth, the Electronic Transactions Ordinance was enacted in January 2000, which gives e-commerce and digital signatures the same legal status as their paper-based counterparts. [28] 24 3.2.3 India India has started embracing the Internet in the past few years. The number of online users in March of 2000 was 770,000 [29]; however, getting accurate numbers on how many people regularly access the Internet is difficult since many accounts are shared, and cyber cafes are extremely popular. [29] The figure 3.2 million is the more likely estimate of Internet penetration, but this only represents 0.2 percent of the adult population of India. This is not surprising considering that a significant portion of the adult population lives under the poverty Une. [29] There were no laws related to the Internet in India until June of 2000 when the Information Technology Act 2000 was signed into law. The Act was a major step forward towards recognizing information technology as a valid form of communication. Before the Act, government agencies were prohibited from keeping electronic records; everything had to be kept on paper in order to be valid. The Act officially recognizes e-mail as a valid form of communication, and electronic contracts and digital signatures are also recognized. [50] The IT Act does have flaws, however. In an attempt to deal with cyber-crime, the Deputy Superintendent of Police (DSP) is given broad powers to pursue cyber-criminals. The DSP is allowed to enter and search any public place and arrest any person without warrant who is "reasonably suspected" of committing a cyber-crime. Furthermore, the DSP may also arrest someone if there is reason to believe the person is about to commit a cyber-crime. [50] How a police officer is supposed to know when someone is about to commit a crime is not defined. The IT Act also gives immunity to the Central Government and the police by not 25 allowing any lawsuit or other legal proceedings for any act done "in good faith in pursuance of the provisions of the Act." [50] This effectively rules out any remedy for people who are wrongfully accused under the Act. Internet Service Providers are held liable for any information deemed harmful (a term not clearly defined in the Act) that the ISP hosts or provides to users. [50] This includes third party data provided to a user as a result of a user query (for example, a search engine providing search results). ISPs are not liable if they can prove that they had no knowledge of any offence, or if they acted with due diligence to prevent the commission of any offence. [50] There has already been a high profile arrest of the proprietors of an Indian search engine ( for providing pornography to users. [60] Rediff contends that they are a mere search engine and do not host the content that is deemed harmful, in that they are only providing the results to a user query; however, the Act still holds them liable. The judge has initially ruled against Rediff, stating that other Indian search engines do not provide access to pornography. This is a misleading statement, since the search engines cited are not technically search engines. They are basically a listing of Indian sites that users can go to; they do not provide general search capability for the broader Internet. [60] It is important to note that the Internet is a relatively new technology in India, and most government officials are not well-versed in the intricacies of the technology. As time passes and knowledge increases, a more reasonable approach to the technology will most likely be adopted. E-Commerce Considerations According to the National Association of Software and Service Companies, India, the 26 e-commerce volume was $3.5 million at the end of 1999, $9.1 million at the end of 2000, and is expected to grow to $23.6 million by the end of 2001. [29] The Indian government is anxious to continue this growth, and the Information Technology Act 2000 is a positive step. The IT Act is mainly concerned with providing laws enabling e-business, such as the recognition of electronic contracts and digital signatures. While procedures for fighting cyber-crime is also dealt with in the IT Act, there is surprisingly very little mention about harmful content; the major form of cyber-crime mentioned in the act is hacking. 3.2.4 Malaysia Malaysia has not as of yet enacted any formal regulations restricting ISP's or Internet users. However, there have been notable cases where the Internet has been censored by government agencies. In August of 1999 when deputy prime minister Anwar Ibrahim was ousted out of power, as many as 48 web-sites criticizing the governments' decision had lawsuits opened against them for making "defamatory accusations". [66] In October of 2000, the Malaysian government threatened to shut down cybercafes in the fear that they were becoming places where undesirable elements would gather. This threat followed regulations passed by the government that closed down all video game arcades in the country for the same reason. [73] More recently in February of 2001, the government banned reporters from the Internet news agency from press conferences and other government functions. The ban is not surprising considering that has published many articles criticizing the government; the government had, however, promised not to censor Internet news agencies or their activities. [72] 27 E-Commerce Considerations In 1999 Prime Minister Mahathir Mohamad created the Multimedia Super Corridor (MSC), a technology park located near Kuala Lumpur. The goal was to bring the research and development efforts of multinational technology companies to Malaysia. [88] Along with various financial incentives, the government has also pledged to not censor content on the Internet. While there has been rising concern about "indecent or unhealthy content available on the Internet, the government has so far steered clear from intervention." [34] The MSC is seen by the Malaysian government as being extremely important to the future of their economy. If the M S C project is successful, Malaysia will most likely adhere to the defense of free speech on the Internet; however, if it is not then community concerns may lead to attempts to curb free speech. The incidents outlined above where the Internet was censored show that the government is willing and able to ban controversial speech; the economic concerns are all that stop them from doing so. 3.2.5 Pakistan The Internet has not caught on in Pakistan as much as it has in neighbouring countries such as India. The main reason for this is the low penetration of PCs and in particular PCs connected to the Internet. According to the Ministry of Science and Technology, by mid-2000 the population of 130 million had bought only 3 million PCs in total. [37] All Internet access is channeled through the state-owned Pakistan Telecommunications Corporation Limited (PTCL). [3] The government is keen on maintaining 'Islamic morals' and as such filters all Internet content for pornography, anti-Islam material, anti-government material, etc. 28 [37] In the charter for the Ministry of Science and Technology, we find the following: "To enable a free society to function, minimum amount of intrusion will be permitted in terms of monitoring and filtering on all kinds of communication." [58] E-Commerce Considerations Pakistan has been politically unstable with the recent military coup, and as such has not been active on the e-commerce front. Only a small proportion of the population (1 million out of 130 million) have Internet access, so the value of e-commerce is low. "There are no accurate figures available on the level of trade conducted over the Internet, but it is not very significant." [37] 3.2.6 Indonesia The traditional print media in Indonesia were heavily censored by the previous dictatorship of President Suharto, using the Ministry of Information to control and censor print media and to spread propaganda. When Suharto resigned in 1998, the Ministry of Information was eliminated, and new press laws were drafted that guaranteed freedom of the press and penalties for impeding this freedom. [57] The legislation applies to Internet publishers as well as print media. However, press freedoms are routinely curbed with regards to sensitive issues such as ethnicity, race, religion, and radical politics. As of yet the Internet has not been censored to any significant extent, with the government more concerned with bringing stability to the country after the turmoil in East Timor. E-Commerce Considerations Indonesian retailers have been quick to offer services on the Internet, with nearly 29 every on-line activity found in developed countries having a parallel in Indonesia. The main problem faced by retailers is the poor Internet penetration rate for Indonesian citizens. According to Pyramid Research, only 435,000 Indonesians have access to the Internet in 2001, a number which will grow to 1.3 million by 2004. In a country of over 200 million people, that is an extremely small number. [30] 3.2.7 Singapore The government of Singapore initially routed all Internet access through a government portal. Filters were used to weed out offensive material; with an emphasis on filtering pornographic material rather than other potentially harmful material (e.g. articles critical of the government). [86] Making the Internet safe for families was, and continues to be, a major focus for the government. This extreme form of censorship has since been toned down and only about 100 pornographic sites are banned by the government, all other sites are accessible. [70] One might ask why these 100 are banned while thousands of others are allowed in, the answer is that the government does not want to appear to be lenient towards pornography while at the same time not seeming draconian in its free speech policies. Singapore does require all ISPs to provide a family-safe access package if the customers so desires in the form of filtering at the ISP level or white-lists of sites the user can access. The Singapore Broadcasting Authority has also set up an online safety fund aimed at promoting development of web-safety resources such as "access management tools, ... appealing and safe content for children, and ... more public education initiatives." [17] Although the outright censorship has been toned down, the government still uses fear 30 to keep the citizenry in line. Singapore does not have the explicit right to privacy laws that many countries do, so officials routinely search accounts for objectionable material (again, for the most part pornography). [70] People can be charged as a result of these scans, and the people of Singapore have learned to respect the power that the government wields. E-Commerce Considerations Singapore is considered to be one of the most advanced Internet economies in the world. [41] The regulatory environment is highly developed for e-commerce, and 920,000 people are on-line as of the end of 2000. By 2004, all 3.2 million citizens are expected to have access to the Internet. This high penetration has helped Singapore become a world leader in e-commerce. It is interesting to note that Singapore initially censored all content, but in order to attract investment have backed down on this stance. Also, under pressure from foreign investors, ISPs are no longer held liable if users access forbidden sites. [70] 3.2.8 Philippines In 1996 the Philippines signed an agreement with the A S E A N countries (a group of east Asian countries led by Singapore) to collectively regulate the Internet; however, even Singapore has since effectively abandoned that agreement, and the Philippines has not enacted any laws pertaining to it. The Philippines have opted to not censor the Internet as of yet, but they do have existing laws against child pornography which also apply to the Internet. [38] The Internet penetration is still quite low, with 495,000 people online at the end of 2000, out of a population of 77 million. These numbers may not be accurate, however, since up to four 31 people can share a single account. [38] E-Commerce Considerations Only about 1% of Philippine businesses are online, as they have been slow to embrace the Internet. Still, the volume of e-commerce transactions in 1999 was $2-3 million (USD), a number that is expected to grow as more businesses come online. The Philippine government has also passed the Electronic Commerce Act of 2000 in order to provide the legal framework for e-commerce. Among other things, it recognizes digital signatures as legally binding and prescribes penalties for computer hacking. [38] 3.2.9 South Korea In the off-line world, the South Korean government has been known to censor information relating to public morals and national security. When the Internet first came to South Korea in 1994, the government was eager to enact legislation curbing access to pornography and other 'subversive material'. [86] Any attempts to do this, however, were initially abandoned as the potential economic gain of the Internet was realized. Recently, the South Korean Information and Communications Ministry has passed a bill which forces web-site creators to label their site if it could be considered harmful to children. Furthermore, any computers in public places such as schools and libraries are required to use government-approved filters to ensure that children cannot access 'harmful' material. The filtering seems to be based on PICS or a PICS-like system and computers would use the government-approved rating system. [64] It is unclear how or if the bill would apply to material not originating in South Korea. The South Korean government cannot force 32 web-sites in other countries to label their material, so the legislation seems pointless. E-Commerce Considerations South Korea has a very strong Internet economy, and it has a solid regulatory framework in place. The e-commerce sector of the economy was a $2.2 billion (USD) market in 1999, and is expected to reach $9.6 billion by 2003. The Internet penetration was 5.5 million people online (out of 46.9 million) at the end of 2000, and will grow to 9.6 million by 2004. [43] 3.2.10 Sri Lanka Sri Lanka has been embroiled in a civil war for many years, and all levels of the economy have suffered as a result. Most Sri Lankans are not online, with only 22,000 out of 18.8 million people online at the end of 1999. As of yet the government has not imposed any specific censorship legislation for the Internet. The press (including the Internet press) are regularly restricted from posting material of political/strategic importance during a state of emergency (a common state during the civil conflict). [45] E-Commerce Considerations There is not much opportunity for e-commerce in Sri Lanka during these turbulent times. The most pressing concern for the government is enhancing the communications infrastructure so that more people can get online. This is gradually occurring as the government technologies ministries have joined with telecommunication firms to improve access. The future potential in Sri Lanka is definitely there, as Sri Lanka enjoys an unusually high level of literacy (92%). [45] 33 3.2.11 Vietnam The Vietnamese government admits to censoring sites dealing with controversial political views by routing all Internet connections through a government-controlled gateway. The censorship is not very thorough, however, as many sites containing radical views are accessible from within Vietnam. [59] Vietnam has historically been quick to adopt new technologies once introduced to them, a fact that allowed its small army to hold off a much larger Chinese force when the two countries were at war in 1979. The Vietnamese government may allow basically unfiltered Internet access in order to encourage the adoption of this new technology by the population, while at the same time not officially endorsing controversial views. [59] As of yet the Internet penetration is quite low [49], but the government's gamble may lead to citizens coming online in increasing numbers. E-Commerce Considerations The Internet penetration in Vietnam is still very small, with 74,600 people online at the end of 2000 (out of 79.5 million), a number that is expected to grow to 210,100 by 2003. The Vietnamese government is focused on increasing the number of people with Internet access by improving the telecommunications infrastructure. There is very little legislative framework for e-commerce, and most firms use the Internet merely for e-mail. [49] 3.2.12 Russia The Internet in Russia is considerably freer than print and television media. It is not seen as a 'mass media', a classification that would bring with it much more government 34 regulation. This non-classification is not just an oversight, as new media laws in parliament specifically exclude the Internet from its jurisdiction. [39] This bodes well for the encouragement of free speech; however, there is also a downside. The 1995 Law on Operational Investigations, a law which allows security services to monitor communications such as postal deliveries and cell-phone conversations, has recently been amended to include electronic communications in its jurisdiction. [39] This means that any government security service can monitor Internet e-mail or chat rooms by obtaining a warrant. In fact, a warrant may not be necessary since it is easy enough to monitor electronic communication without anyone ever knowing. E-Commerce Considerations Russian Internet penetration was 574,600 people online at the end of 2000, and will grow to 1.6 million by 2004 (out of 146 million). [39] Free Internet access has recently become available in Russia, and if it proves to be a viable business model then Internet access will flourish. [84] The total amount of e-commerce at the end of 1999 was estimated at $46 million (USD), and the Boston Consulting Group estimates this could reach $400-600 million by 2003. [39] 3.3 South America 3.3.1 Argentina The Argentinian government has given serious consideration to the topic of censorship on the Internet. In Presidential Decree 1279/97, enacted on November 25, 1997, it "explicitly 35 stated the governments support for Internet development and its refusal to interfere with production, creation and diffusion of information that is distributed on the Internet." [59] This is the same freedom given to the press, radio and television in the country. To make this policy clear to citizens, the government requires ISPs to make the following statement in every user invoice: "The National State does not control or regulate information available on the Internet. Parents are recommended to exercise reasonable control over the content accessed by their children. It is advisable to consult your ISP to obtain suitable advice on programs designed to prohibit access to undesirable sites." [59] This is a very strong defense of free speech made by the Argentinian government. There is some controversy over this decree, however, as some prominent politicians have attempted to enact a bill that would crack-down on 'hate speech' and/or racist web-sites. [59] E-Commerce Considerations Although there has been much growth in Internet usage in recent years, Argentina still suffers from a poor penetration rate. There were 905,500 people online at the end of 2000, and there will be 2.4 million by 2004. These are small numbers considering the population of Argentina is 36.6 million. E-commerce revenues at the end of 1998 were $1.7 million (USD) (the latest figures available). This number is expected to have grown significantly since then due to the large number of e-commerce sites that have been opened up in recent years. [20] 3.3.2 Brazil The issue of censorship of the Internet by the government has not come up yet in 36 Brazil. Currently speech is free on the Internet in Brazil; however, as the government rushes to enact legislation to help e-commerce, censorship laws could be passed as well. Although Brazil has freedom of the press laws, the traditional press is censored in some ways. It is not uncommon for journalists to be threatened if they decide to expose government corruption. [12] Also, journalists and newspapers are regularly fined for 'defamation' when they publish articles critical of the government. [85] These attitudes do not bode well for the future of free speech on the Internet in Brazil. E-Commerce Considerations Brazil had 4.3 million users online at the end of 2000, and will have 12.7 million by 2004. Considering the population is 163.7 million, this is a small number indeed. [22] Free of charge Internet service and the development of cheap PCs by researchers should help to spark Internet usage by the general population. [7] Total e-commerce transactions at the end of 2000 were $449 million (USD), and will grow to $3.2 billion by 2003. E-commerce has so far grown without much of a regulatory framework; a situation which is changing as the government passes new legislation. [22] 3.4 Middle East 3.4.1 Saudi Arabia Up until February 1999, the Internet was not available to the general population of Saudi Arabia; it was confined to universities and hospitals only. The reason for this was that the government was fearful of the 'harmful' material such as pornography that was widely 37 available on the Internet. [86] Now it is relatively easy to get Internet access; however, all traffic is funneled through the Internet Unit at the King Abdulaziz City for Science and Technology (KACST). The Internet Unit filters out pornographic, political, anti-Islamic, and other controversial material before it reaches the user. [40] This is a harsh form of censorship, and many users access the Internet illegally through overseas ISPs in neighbouring countries to avoid it. [86] E-Commerce Considerations There were 131,100 people online at the end of 2000 (out of 20.8 million), and this is forecast to grow to 291,500 by 2004. This number is probably too low, since many users access the Internet illegally to avoid censorship. Regardless, a significant proportion of the population is online. Accurate numbers for e-commerce are difficult to find, but officials cited $10 million (USD) after one year of legalized Internet access in February 2000. Businesses have been slow to catch on to the Internet yet, as 67% of firms did not have access to the Internet at the end of 1999, according to a K A C S T survey. [40] 3.4.2 Israel The official government stance on the Internet is that it is committed to keeping it free of censorship. The traditional media such as newspapers, radio and television are subject to state censorship, but the Internet has so far been excluded. [59] There has been one case where the author of an Internet site was asked to close down his web-site by the government. Michael Eldar, a former army officer, wrote a book about the loss of an Israeli submarine in 1968. The book was pulled out of bookstores by the government because it contained 38 'sensitive' material. Portions of the book that were placed online in a non-Israeli Internet account by Eldar were removed after he was asked to do so by the government. Whether he was forced to do so under duress or simply politely asked is not known. [59] This has so far been the only high-profile case of pseudo-censorship that Israel has imposed on the Internet. E-Commerce Considerations Israel had 893,400 users online at the end of 2000 (out of 6.1 million), and will have 2.0 million online by 2004. This is an extremely high level of penetration. E-commerce transactions totaled $17 million (USD) at the end of 1999. The only thing holding back e-commerce is the scarcity of Hebrew and Arabic content available. [33] Once this shortcoming is addressed e-commerce should grow by leaps and bounds. 3.4.3 Iran and Iraq Both Iran and Iraq have an extremely low PC penetration, and Internet access is a luxury afforded to a very small segment of the population. In Iran, there are four ISPs that provide slow access to the Internet (approximately 9600 baud). The press in Iran is heavily monitored and routinely censored, and local Internet sites are monitored for material that promotes dissent. [31] The slow access rates and poor PC penetration probably explain why more censorship of the Internet has not been enforced; as long as people cannot get to objectionable material then there is no need to censor it. This may be changing, as recently the government closed down more than 400 cyber-cafes for the official reason that they did not have licenses, despite the fact that there is no procedure to obtain licenses. [65] Iraq has bigger problems than Internet access, with the U . N . sanctions still in effect. 39 The Internet at present is basically only available to government officials. The press in Iraq is run by the government and no opposition newspapers are allowed. In late 1998, the Ministry of Justice and the Interior said it would be passing legislation for the Internet that would deal with security issues as well as the distribution of obscene or immoral material, however this has not happened as of yet. [32] E-Commerce Considerations There is basically no e-commerce in either Iran or Iraq, as poor PC and Internet penetration have held them back. "There will be no e-commerce in Iraq without an estimated $1 billion in network modernization." [32] Similar infrastructure enhancements are needed in Iran. 3.4.4 J o r d a n When Internet use was provided to the general population in 1995, the government required ISPs to block all sexually explicit material. [86] As more ISPs arrived these restrictions were relaxed, and as of 1999 there were no restrictions imposed on web-content providers, users, or ISPs. In fact, users in neighbouring countries like Saudi Arabia start up accounts in Jordan and pay the long distance rates in order to have access to an uncensored Internet. [59] The only form of mild censorship is found in the cyber-cafes. If users are found to be accessing pornographic material, they are asked to stop because the cyber-cafes are public places where children are regularly present. No account blocking or other restrictions are imposed on the user. [59] 40 E-Commerce Considerations Jordan has a relatively high level of PC penetration and Internet access is enjoyed by a significant portion of the 5 million people of Jordan. E-commerce numbers are difficult to find, but there are a large number of businesses online in Jordan. [59] 3.5 Africa 3.5.1 Nigeria Censorship of the Internet has not been an issue in Nigeria as a vast majority of the population has neither the telecommunications infrastructure nor the economic advantage to afford Internet access. In the past the traditional print media have been censored heavily, but after the fall of the Abacha regime, Nigeria once again has a free press. The government is unlikely to impose censorship of the Internet as it is more likely to monitor the traditional press, which is much more accessible to Nigerians. [36] E-Commerce Considerations There is no significant e-commerce transacted over the Internet in Nigeria. As of 1999, there were only 50,000 people online in a country of 125.2 million. Nigeria is the most populous country in Africa, and approximately 10 million Nigerians are recognized as potential Internet users. The major obstacle to Internet penetration is the favouritism the Nigerian Communications Commission shows to the state-owned telecom operator Nitel. Nitel is due to be privatized in 2001 or 2002, at which point competition might open up and the Internet may start to flourish in Nigeria. [36] 41 3.5.2 South Africa South Africa has embraced the Internet more than any other African nation, and does not implement any blocking at the government level. One major threat to free speech is new legislation that makes ISPs liable if child pornography passes through their network. This means that if a user accesses child pornography, the ISP must immediately inform police of the offense; if it does not and the police find out through other means then the ISP is liable. How ISPs are expected to monitor all traffic that passes through their network is not outlined. Clearly such monitoring is impossible. To date there have not been any ISPs convicted under this legislation. [42] The South African Human Rights Commission has severely criticized the traditional press in South Africa for partiality and racism in a report published in November 1999. This partiality and racism will most likely also occur in online publications, seeing as how the average Internet user in South Africa is a relatively wealthy white person; there were at most 200,000 black Internet users at the end of 1999. [42] This form of censorship and bias will affect Internet content in South Africa. E-Commerce Considerations There were 729,000 people with Internet access in South Africa at the end of 2000 (out of a population of 43 million), a number expected to grow to 1.6 million by 2004. This is a small percentage, and will be helped by projects to improve telecommunications facilities in rural areas. The total amount of online retailing in South Africa was $72.3 million (USD) in 1997, and has grown to $390 million at the end of 1999. [42] As in Malaysia, in early 2000 42 the South African province of Gauteng promised to invest heavily in creating an 'Innovation Hub' area which will hopefully bring technology companies to South Africa. [56] 3.6 Australia Although Australia is a democratic country, it has one of the most restrictive Internet free speech policies in the world. In January 2000, the Commonwealth Government's Internet Censorship legislation came into effect. The bill was rushed through the Senate, and a preliminary draft was not made available for public comment despite assurances that it would be. The legislation provides a mechanism for Australian citizens to lodge complaints about Internet content. The Commonwealth government does not have the jurisdiction to censor publications or film, but it does have power over television and radio broadcasting. It is under these powers that it has legislated controls over Internet content. [5] The Commonwealth has also encouraged the Internet Industry Association (IIA) to implement a Code of Practice that contains a list of 'approved filters' that ISPs are required to "provide for use, at a charge determined by the ISP". [5] The list of filters was not determined based on a study of their effectiveness, instead it was based purely on the fact that the filter supplier incorporated URLs notified by the Australian Broadcasting Authority (ABA) in the filter blacklists. The A B A has also decided that adult verification systems are mandatory for sites that contain R-rated content, or "adult themes". X-rated content, or sexually explicit content, is effectively banned on the Internet in Australia. The adult verification system must be based on a reliable method of determining the age of the person, 43 with credit card verification the preferred method. [5] How effective a system based on credit card verification is has not been questioned; can a child not get a credit card from their parents without their knowledge? Once the Commonwealth passed its legislation, it also started pressuring the States and Territories to pass legislation covering Internet content. Draft legislation was produced by many States in 1999, and the first Internet Censorship bill was brought before the parliament in South Australia in November 2000. [87] This legislation goes further than even the draft legislation was pressuring for. Having any web-site content that would be unsuitable for children is illegal, even if the web-site is only made available to adults through password protection. Content unsuitable for minors is defined in the same way as for films (since much of the legislation is based on existing legislation for films), i.e. anything with 'adult themes'. These include: "verbal references to and depictions associated with issues such as suicide, crime, corruption, marital problems, emotional trauma, drug and alcohol dependency, death and serious illness, racism, and religious issues." [87] The prosecution proceedings against content providers can occur before the content on their site is classified. Since the legislation is based on the film review standards, content providers are required to guess what classification their content would receive from a panel of reviewers. Police are allowed to make the judgment on what is unsuitable for minors; however, they are not trained in such matters and have made numerous errors in the past when deciding what constitutes unsuitable material in the offline world. Content providers are not even allowed an opportunity to remove the unsuitable material when they inadvertently miss-guess the classification. [87] 44 Since the legislation treats the Internet like film, it in effect criminalizes material online that is not illegal offline. Print material of an adult nature is legally allowed to be mailed to people, but this would now be illegal online. Furthermore, the fines for making unsuitable content available on a web-site are exactly double the fines for making an unsuitable film available in the offline world. [87] Why should the online world face stiffer fines than the corresponding offline equivalent? Once other states follow the lead of South Australia and enact their own Internet legislation, content providers could face charges in other jurisdictions if the classifications are different there. This places undue burden on content providers to ensure that they do not have material that would be deemed unsuitable in any jurisdiction in Australia. [87] What has been the effect of the Australian governments efforts to make the Internet safe for children? In terms of complaints received by the government from citizens about unsuitable content, a report: "... disclosed that during the period July 1 to Dec. 31, 2000, the ABA issued 67 take-down notices for Internet content housed in Australia, two-thirds of which involved child pornography. By contrast, the ABA made 136 referrals about content housed outside Australia to domestic filtering companies." [89] This is a very small number of complaints, and a far cry from the massive wave that the government had expected. This indicates that the government's attempt to curb free speech have so far been largely a waste of resources. Beyond content regulation of the Internet, another law relating to copyright 45 infringement has also been enacted. Forwarding e-mail without the permission of the author is now illegal in Australia. This does not just include copyrighted works such as music or literature, any e-mail is considered a 'communication' under the Digital Agenda Act, and as such a person needs permission to forward it. With the sheer volume of e-mail traffic, it would be impossible to police this. Australia's Attorney General Daryl Williams has stated that forwarding "a personal e-mail is unlikely to breach copyright laws," but also suggests that liability could result if a court determines that the content of the e-mail was an 'original literary work'. [10] Overall Australia's Internet policies are among the most restrictive to speech in the world, and with more states passing legislation restricting content, things will only get more restrictive. The attempt to force the Internet into legislation designed for film has resulted in ill-fitting laws that ban speech with any hint of controversy. If these laws are allowed to stand it will result in a very boring Australian Internet experience seemingly designed solely for children. E-Commerce Considerations Australia has a strong e-commerce base, with 6.5 million people online in 2000 (out of a population of 19 million). This number is expected to grow to 9.2 million by 2003. The total e-commerce revenue was $100 million (Australian dollars) in 2000. [21] When the Internet content regulations were made public, many people had concerns about how it would affect the e-commerce landscape. Senator John Tierney had this to say in April 1999: "what happens in Singapore and Malaysia, which would probably have the most restrictive access regime in the world by the use of proxy servers to filter out what the government considers 46 to be unsuitable material. Internet businesses, as we heard last night, are absolutely booming in Singapore. Having such a restrictive server system does not seem to be restricting any commerce in those countries." [4] What is ironic about these statements is that both Malaysia and Singapore have gone back on their restrictive policies, and have pledged not to censor content on the Internet (although Singapore does block exactly 100 sites deemed objectionable). 3.7 Europe 3.7.1 European Union The European Union provides the framework for laws that supplement the laws that individual member countries may or may not have. In terms of regulation of 'harmful' content on the Internet (as opposed to illegal content), the E U has recommended a scheme of voluntary self-regulation. In Decision 276/1999/EC, the E U provides funding and encouragement for industry and users to develop rating systems, and to test and implement filtering technology. [25] ISPs have had a rocky road with the regulations passed by the E U in recent years. In May 1999, the E U passed regulations that made ISPs responsible for policing the material posted on all sites hosted by them. This meant that ISPs had to monitor all web-sites and react to illegal material posted before a significant number of people saw it; a nearly impossible task for ISPs. In September 1999 these regulations were relaxed, and ISPs are currently only liable for illegal content about which they have been notified. [25] 47 E-Commerce Considerations Numbers for the European Union are somewhat misleading because the member countries vary so much in terms of their contribution to Internet penetration and e-commerce transaction volume. Still, one can get a good idea of the total contribution of these countries. The E U has approximately a 13% Internet penetration rate as of the end of 1999. The total value of e-commerce transactions was Euro $36 billion at the end of 1999, and the annual growth rate is forecasted at over 100% for the next four years. [25] 3.7.2 Sweden Sweden has whole-heartedly embraced the Internet; at the beginning of 2000, 42% of Swedish households had Internet access. Among Swedish teenagers, 97% use the Internet to some extent, and 71% of people between 16-65 are online. The Swedish government has implemented policies to enhance broadband network availability for all citizens, even those in rural areas. Censorship of the Internet has not been an issue in Sweden, and the government imposes no restrictions on ISPs or on Internet content. [46] E-Commerce Considerations Sweden is seen as a world leader in e-commerce, and is considered second only to the U.S. in e-commerce market maturity. The government has explicitly recognized the importance of the Internet to the economy and has enacted legislation to foster e-commerce growth. E-commerce spending was $2.1 billion (USD) in 2000, and is projected to grow to $8.7 billion by 2002. [46] 48 3.7.3 United Kingdom The official position of the U K government is that it wants to provide a 'light regulatory touch' in order to promote e-commerce. [47] Thus its free speech policies have been to not explicitly censor content and to rely on existing laws to punish illegal content. In the early days of the Internet, the government wanted groups such as the Internet Service Providers Association (ISPA) to develop a code that would cover "illegal and undesirable material". [86] This did not happen. The government passed legislation making ISPs liable for libelous material posted by their users, unless they could prove they took measures to prevent the posting, or they remove the material when notified. The first court case under this law was settled out of court in March 2000, when Demon Internet agreed to pay damages to an individual because it failed to remove defamatory material from hosted newsgroups after being notified. [47] The battle over ISP responsibility is still being waged; in early 2001 the British health minister sent a heated letter to the ISPA stating that an ISP could be held accountable for 'questionable' material. The letter was the result of an incident where twins were given up for adoption to two different sets of parents via the Internet. Obviously, the ISPA protested that it could not be held accountable for the vast amounts of information posted on its servers. The health minister officially backed down from his initial position and agreed that it was an unreasonable idea. [11] Another major issue in the U K is the intent by many law enforcement agencies to record all e-mails, phone calls, and web-sites accessed by all citizens. As recently as December 2000, they were pressuring the government to allow them to collect this 49 information and store it for seven years in order to properly police the Internet. [2] Aside from obvious privacy concerns, this would have a chilling effect on free speech on the Internet. Recently, the government is pushing for legislation that would force computer makers to pre-install blocking or filtering software on new computers in order to block certain forms of content. Furthermore, ISPs would be encouraged to offer ratings systems; any ISP refusing to do so would not receive a 'family friendly' certification from the government. [9] These are drastic changes that would affect the ability of British citizens to express themselves online. E-Commerce Considerations The United Kingdom has a very good Internet penetration rate, with 45% of British adults having access to the Internet either at home or at work in March of 2000. The e-commerce environment is considered to be one of the strongest in Europe, with $11.5 billion (USD) in e-commerce spending in 2000. This is expected to grow to $47.6 billion by 2002. [47] 3.7.4 G e r m a n y Germany has been trying to censor pornographic and racist material on the Internet since the early days. The obvious turmoil Germany has gone through in the past century explains why it wishes to ban racist and hate-mongering material; however, it has not considered adequately the effect its policies could have on the Internet as a whole. In 1995, the German government forced Compuserve to shut down access to over 50 200 newsgroups dealing with pornography. These newsgroups were still accessible by savvy users of Compuserve who were able to access other hosts which carried the newsgroups. Three months later the newsgroups were reinstated by Compuserve. [86] In late 1996, the ultra-leftist publication Radikal published an article detailing how to derail a train. The publication was banned by German authorities, and paper copies were destroyed. The web-site was also shut-down, but soon re-opened on a provider in neighbouring Denmark. The German government made all the major ISPs block the particular site, but when it kept changing names it eventually had the ISPs block the entire domain of the Dutch provider. This led to the blocking of effectively 6000+ web-sites hosted by the Dutch provider. Soon after mirrors of the blocked site popped up, and the German government realized that the blockade was a failure. [59] Turning to racist material, in 1996 many major ISPs in Germany started blocking access to anti-Semitic material which was hosted in other countries. This type of neo-Nazi material is illegal in Germany; the most notable site blocked was Ernst Zuendel's, a German-born neo-Nazi living in Toronto. The site was quickly picked up by many free speech advocates and mirrored, rendering the German blocking ineffective; the site was still accessible to German users. [86] More recently, in December 2000 the German government threatened legal action against Yahoo Deutschland for selling copies of Hitler's Mein Kampf over the Internet. German law forbids the sale of the anti-Semitic book to the general public. The book is available in some bookstores in Germany, but cannot be purchased unless the seller can determine that it is being bought for academic or research purposes. [63] Due to the relative 51 anonymity provided by the Internet, Yahoo was in essence providing unrestricted access to the book. It is interesting to note that this was a case of a German company doing business on the Internet to German customers. The case has since been dropped as of March 2001, with the German officials stating "Yahoo could not be charged with incitement to racial hatred, because the Internet giant is the provider rather than the person directly offering the service." [53] More alarming than the above incident, Germany has also recently decided that people outside of Germany can be convicted under German law if they post racist material on sites that can be accessed by Germans. In December 2000, the highest court of Germany found Australian Holocaust-denier Frederick Toben guilty of spreading 'Auschwitz lies' for posting material on an Australian site stating that the Holocaust has no historical basis. As of yet there has been no formal extradition request from Germany, but if Toben returns to Germany he could face up to five years in jail. [62] If this verdict holds it will set a dangerous precedent for other countries, as jurisdictions on the Internet are difficult to determine because of the relative geographic neutrality on the Internet. The Toben incident has already had repercussions in Germany. The German Central Council for Jews announced in February 2001 that it was planning to sue ISPs for providing access to Nazi web-sites. Whether the Nazi sites were located in Germany or not is apparently unimportant. [52] Cases such as this could easily lead to ISPs filtering content in order to avoid future lawsuits, effectively chilling free speech on the Internet in Germany. E-Commerce Considerations Germany has a very good Internet penetration rate, with 19.5 million people online 52 at the end of 1999, out of 82.5 million. Germany's e-commerce market is considered very mature, and the regulatory framework to promote e-commerce is in place. E-commerce revenues hit $5.6 billion (USD) in 1999, and are projected to reach $62.8 billion in 2002. [27] 3.7.5 France France has laws similar to Germany with regards to racist material. Racist goods cannot be advertised or sold to any French citizen, and this has led to a landmark case that could have ramifications for the entire Internet. In November 2000, a French court ordered Yahoo to block French users access to auction sites located on its servers in the United States that contain Nazi memorabilia. These goods are forbidden by French law to even be advertised and according to the French court it is Yahoo's responsibility to ensure that French users cannot access these sites. [15] How Yahoo will go about determining the geographic location of its users is a mystery. A reliable method for determining such information does not at present exist on the Internet. Yahoo plans to fight the court ruling on the grounds that it cannot block access effectively since current technology is unreliable, and in the case of filters, over-broad. [15] If the case stands, the chilling effect on Internet speech is obvious. Web-site creators would have to worry about all the countries accessing their site to ensure that they are not offending any part of the worldwide population. French law with regard to ISPs has changed drastically since the Yahoo ruling. The French government released a draft Law on the Information Society that makes ISPs liable for illegal content if they do not remove or deny access to the content upon being informed 53 of it. This liability applies not only to the ISP, but all the way to the telecom provider. Furthermore, ISPs are required to keep log files of users activities for one year, effectively curbing anonymous free speech. [77] E-Commerce Considerations Internet penetration is surprisingly low in France when compared to its neighbouring countries such as the U K and Germany. There were only 2.9 million Internet users in 1999 (5% out of a population of 59 million). This number is expected to grow to 14% in 2002, and 18% by 2003. [26] One of the possible reasons for the slow adoption of the Internet is the existing Minitel system that France Telecom has had since 1983. This text-based system provides online shopping and information from dumb terminals. [59] People used to the Minitel system have not seen the benefit of the Internet yet, but are slowly moving towards it. E-commerce spending in France was $4.6 billion (USD) at the end of 2000, and is expected to grow to $28.5 billion by the end of 2002. [26] 3.7.6 Spain Spain has not had any legislation concerning the Internet, but recent attempts by the government to pass e-commerce legislation has far-reaching ramifications. The Electronic Commerce Directive is designed to provide a regulatory framework for e-commerce in Spain, but goes far beyond this: "This directive ... has invented the concept of 'society of information services' and wants to legislate plain exchange of information as an economic activity, ruling out therefore, any publisher - like NGOs - which do 54 not really perform any commercial activities and can not face all the legal and bureaucratic activities that the Electronic Commerce (Society of Information Services) Directive wants." [13] Basically any distribution of information, even if no payment is required to receive the information, constitutes a 'society of information services'. This implies that the service (i.e. web-site, newsgroup, etc.) is an economic activity and is subject to registration, consisting of providing your name and address with your domain name to a public register, and the publishing of your name/address on your service. This Directive outlaws anonymous web-sites as well. The legislation explicitly mentions search engines and online compilations of information (such as newsletters). E-mail is the only form of communication excluded from the Directive, so long as it is not used for commercial purposes. [13] Any interaction with the user of your service must be handled as if it were a commercial transaction, meaning you must use a proper contract, provide the language of choice, and several other measures which make sense in a commercial environment but are ludicrous when freely exchanging information. [13] The Electronic Commerce Directive could have a chilling effect on speech in Spain if it is allowed to pass in the present form. Any controversial web-site (for example, a human rights site) which does not want to publish and/or register its name and address will be liable under the Directive. Any sites critical of the government could be shut down for something as innocuous as not conducting their information exchange with a proper commercial model (i.e. proper contract, etc.). [13] The burden on non-commercial web-sites would be very high, as they would not generally have the funds available to handle the bureaucratic hassles 55 of starting up a web-site. E-Commerce Considerations Spain had a relatively low Internet penetration rate of 8% at the end of 1999, due mainly to the high connection fees that users experience. Users actually held a loosely organized strike where they refused to go online on certain days in order to protest the high prices in 1999. E-commerce spending was $1.8 billion (USD) at the end of 2000, and is expected to grow to $8.7 billion by 2002. [44] 3.8 North America 3.8.1 Mexico Mexico has embraced the Internet in recent years, and with infrastructure enhancements expected, more people will be able to access the Internet through dial-up accounts. According to IDC Select there were 2.3 million users at the end of 1999, a number which grew to 3.5 million by the end of 2000, more than a 50% growth. In a population of 95.6 million, this is still a small number, but the growth rates are promising. The Mexican government has not as of yet moved to restrict freedom of speech on the Internet. In fact, the Internet has become a powerful medium of dissent in Mexico, with Subcomandante Marcos, leader of the Zapatista rebellion, using the Internet as an international podium for promoting its cause. [35] E-Commerce Considerations Although the small PC and Internet access penetration has held the e-commerce sector 56 back somewhat, the future does look bright. According to eMarketer, online sales amounted to $3.2 billion (USD) at the end of 2000, and will grow to $15 billion by 2003. When business-to-business transactions are included, Latinexus predicts that the total e-commerce transactions in the year 2003 will be $70 billion. [35] 3.8.2 Canada As in many European countries, Canada has placed limitations on free speech with regards to racist and/or hate speech and on child pornography. In the free speech spectrum, Canada ranks between the United States and European countries such as Germany and France in terms of the amount of free speech compromised, with the United States coming closest to the near-absolutist model (at the present time). The Internet free speech issues raised in Canada vary widely. The first issue is due to the bilingual nature of Canada. In the French-speaking province of Quebec, English-only signs are banned in public places. The provincial government has moved to extend these bilingual standards to the Internet. The first move occurred in September 1999, when the ISP Bell Canada was ordered to cease offering Netscape Navigator until it could provide a French-language version. As it stands, commercial web-sites catering to the people of Quebec are required to have a French version of their web-site with the same material as the English version; failure to do so results in a fine. [51] Racist speech is of great concern in the multicultural environment of Canada. In 1998, Fairview Technology Centre Ltd., an ISP located in Oliver, BC, was accused of hosting many 57 racist and hate literature web-sites. Investigations were undertaken, but no formal charges were ever laid. The ISP officially halted business while the investigations were underway, however it promptly returned to business months later, but this time the hate literature was disguised in more indirect links. [18] Laws pertaining to the possession and distribution of child pornography also exist in Canada. The current laws state that it is illegal to possess child pornography, even if you do not distribute it to any other person. This law was recently tested in the case of John Robin Sharpe of British Columbia, who was accused of possessing child pornography in 1998. The B.C. Supreme Court found that the possession law went against the Charter of Rights and Freedoms, and recently the Supreme Court of Canada "said that people can't be prosecuted for creating photographic or written porn as long as it's designed for their own use and as long as real photos don't show unlawful acts." [80] E-Commerce Considerations Canada has a very mature e-commerce environment, with a regulatory framework in place conducive to e-commerce. At the end of 1999 there were 12.5 million people online out of a population of 30.6 million, a very high Internet penetration rate. E-commerce revenues were $28 billion (USD) in 1999, and Canada enjoys a 7% share of global e-commerce. [23] 3.8.3 United States of America Although the U.S. has strong constitutional protection of free speech, the Internet has been a contentious issue for lawmakers. The Communications Decency Act of 1996 was an 58 attempt by the United States government to limit minors from accessing material on the Internet that was 'indecent' or 'patently offensive'. It was intentionally vague in terms of whether it applied to both commercial and non-commercial speech. There were many reasons why it was found unconstitutional by the Supreme Court, not the least of which were the fact that it was broad in the scope of material it applied to, and that it would have placed too heavy a burden on an adult's access to such material. [6] The Child Online Protection Act is the second attempt by the government to achieve the goal of protecting minors from accessing harmful material. This time, the Act is much more narrowly tailored; it is targeted at commercial speech that is 'harmful to minors'. Any site selling material that is 'harmful to minors' must have appropriate safeguards to reasonably ensure that minors cannot access it; this can take the form of adult Ids, credit card checks, or digital age certificates. [67] Notice that the words 'indecent' and 'patently offensive', which had vague definitions in the CDA, have been replaced by 'harmful to minors'. In the COPA, this is defined as: "Any communication, picture, image, graphic image file, article, recording, writing, or other matter of any kind that -(A) the average person, applying contemporary community standards, would find, taking, the material as a whole and with respect to minors, that such material is designed to appeal to or panders to the prurient interest; (B) depicts, describes, or represents, in a patently offensive way with respect to minors, an actual or simulated sexual act or sexual contact, actual or simulated normal or perverted sexual acts, or a lewd exhibition of the 59 genitals or female breast; and (C) taken as a whole, lacks serious literary, artistic, political, or scientific value for minors." [69] This is similar to the Ginsberg test for obscenity which has been used in the U.S. in cases related to pornography and other questionable material. [67] The constitutionality of the COPA is still being decided upon. The American Civil Liberties Union (ACLU) has argued in the courts regarding the constitutionality of the Act. Philadelphia Judge Lowell Reed had issued an injunction preventing the enforcement of the Act, and the Act was found unconstitutional in June of 2000 by a federal appeals court. [81, 1] Recently the Attorney General petitioned the Supreme Court to review the Act, and this will occur in the near future. [1] Thus, the COPA is following the same route as the CDA; first a loss in the lower courts, and then a final decision being made by the Supreme Court. As outlined in the last chapter, the U.S. has also recently passed the Children's Internet Protection Act which requires all public libraries and schools that receive government funding to use some form of blocking or filtering technology on their computers. The constitutionality of this legislation will also be tested in the courts. [8] E-Commerce Considerations The United States has the strongest e-commerce sector in the world, and the largest share of the e-commerce marketplace. The Internet penetration rate is now at 31% and should reach 56% by 2003. E-commerce revenues were $74.5 billion (USD) in 1999, and are projected to reach $851.4 billion by 2003. [48] It is interesting to note that many of the arguments against proposed bills such as the C D A and COPA have revolved around the 60 possible negative effects they would have on the e-commerce environment. [69] 3.9 Summary As can be seen from the above summaries, countries vary widely in the free speech policies that they apply to the Internet. The e-commerce landscapes differ just as greatly. It is interesting to note that even within each region it is easy to find a wide range of policies and e-commerce revenues. At present it is difficult to characterize the free speech policy that a country chooses based on the geographic location of the country (and this is not the intent of this thesis). The next chapter attempts to find some relations between e-commerce concerns and the free speech policy of any particular country. 61 Chapter 4 Analysis 4.1 Introduction The continued commercialization of the Internet has become a central part of the economies of most countries in the world. On an intuitive level, the free speech policies with respect to the Internet taken by the government of a particular country should affect the development of the e-commerce sector. Finding absolute measures of how a change in free speech policy can affect e-commerce growth would be difficult if not impossible since e-commerce is affected by so many factors (including computer penetration, legal and political infrastructure, etc), and is not the intent of this thesis. However, it is possible to see how e-commerce concerns have affected the Internet free speech policies of different countries. In other words, how much has the concern of restrictive free speech policies stifling e-commerce growth affected said policies? 4.2 Categories of Effect What follows is a breakdown of all the countries surveyed in the last chapter into three categories: those where e-commerce concerns have had a large, moderate, or negligible 62 effect on free speech policies. This grouping into categories is somewhat subjective as there is no clear line between categories, but some rationale for choosing which category a country belongs in is given in each section. 4.2.1 Large Effect To say that e-commerce concerns have had a large effect on the free speech policies chosen by a particular country's government, there has to be a strong connection between the two. This connection can be in the form of a strong statement made by the government explicitly mentioning that e-commerce concerns have prompted them to adopt specific speech policies, or a reversal of policy that was very clearly done due to pressure from the e-commerce sector. The Argentinian government enacted a Presidential Decree in 1997 explicitly stating that in order to encourage the growth of the Internet, it would not in any way interfere, filter, or block Internet content. It even went as far as to require all ISPs to include a statement in their user invoices informing their customers that the government will not censor content, and if users are concerned about their children's access they should exercise 'reasonable control' through education or filtering/blocking software. [59] Clearly the government views e-commerce growth as having a significant dependence on a free and uncensored Internet being provided to Argentinians. Situated in the Middle East, Jordan is surrounded by countries with very restrictive free speech policies. When the Internet was first introduced to Jordan in 1995, the government required ISPs to block all sexually explicit material; a requirement that was 63 quickly dropped as more ISPs arrived. [86,59] The government realized the opportunity the Internet represented and dropped its restrictive policies to encourage e-commerce growth. This has occurred in Jordan, and in fact many users in neighbouring countries open accounts in Jordan and pay the long distance rates just to have access to an uncensored Internet. [59] Jordan has committed to keeping the Internet free of censorship in order to help the e-commerce sector. Malaysia has in the past censored the Internet when controversial political situations arose. [66] However, in 1999 the Prime Minister created the Multimedia Super Corridor (MSC), a technology park designed to entice technology corporations to come to Malaysia. As part of this plan, the Prime Minister also pledged not to impose censorship of any kind to the Internet in Malaysia, amid much protest from more conservative elements of Malaysian society. [88,34] The success of the MSC will mean that the Internet stays free; failure means censorship will return. The pledge represents a huge endorsement of how a free and open Internet is vitally important to successful e-commerce growth. Singapore is another country that has shown a large recognition of the importance of free speech to Internet growth. Initially all Internet access was routed through a government portal, where filters were used to weed out offensive material (mostly pornographic and politically critical material). [86] Today, only about 100 sites are explicitly blocked by the government, all of them pornographic, in order to send a message to citizens that the government does not approve of these sites. No other sites other than these 100 are blocked. [70] This lessening of a very restrictive free speech policy was explicitly done in order to encourage e-commerce growth. This is an important development, as Singapore has 64 historically been a country that is quick to sacrifice individual rights for the good of society. The fact that it was willing to provide very close to uncensored (100 sites is a drop in the water compared to the millions of web-sites that exist) Internet access speaks to its perception of how important free speech is to e-commerce growth. The situation in Spain is a case where e-commerce concerns have had a very large effect on free speech on the Internet - although not in the same sense as in other countries. The government of Spain passed the Electronic Commerce Directive to provide a regulatory framework for e-commerce, but the net effect of it is to treat any distribution of electronic information as an economic activity; meaning that the parties must register with a public authority, among other things. [13] It is easy to see how this legislation greatly affects free speech on the Internet in Spain; for example, anonymous web-sites are now outlawed. The Directive seems to be a product of legislators not understanding the technology well enough and passing a law that has far-ranging effects not originally envisioned. 4.2.2 Moderate Effect In many countries e-commerce concerns have been somewhat important to the shaping of Internet speech policies. While they may not be the main driving force behind the adoption of particular policies, there is clear evidence that the effect of such policies on the e-commerce landscape have been very seriously considered. Hong Kong has maintained a mostly free and open Internet as compared to China which has enacted very restrictive policies. The only restriction is that obscene material may not be posted by web-site creators in Hong Kong, but material from other countries is not 65 blocked or filtered. [59] China seems to be using Hong Kong to see what happens when the Internet remains free and unfiltered. E-commerce concerns seem to be driving this hands-off approach that China has adopted in its Internet policies in Hong Kong. With a strong e-commerce sector in Hong Kong, China may be wary of imposing restrictive policies that could stifle growth. India has just recently given thought to regulating the Internet. The IT Act 2 0 0 0 aimed at providing a regulatory framework for e-commerce, and while 'harmful' content is made illegal, it is not the main focus of the legislation. Indian society is generally conservative and one would assume that dealing with 'harmful' content would be the first priority of lawmakers. The fact that facilitating e-commerce has been the number one concern implies that the Indian government sees a strong correlation between a free and open Internet and e-commerce growth. The Internet in Russia is not officially seen as a 'mass media', a classification that would entail much more government regulation. This lack of classification is not just an oversight since new media laws specifically exclude the Internet from government jurisdiction. [39] Although e-commerce concerns are not explicitly mentioned as the reason for not classifying the Internet as 'mass media', it would seem to be the driving motivation. The Internet is seen as a vital tool for economic growth in Russia, and the government seems to view free speech as important to making the Internet economically viable. The South Korean government has been anxious to censor the Internet since its inception, but had steered clear from doing so due to its desire to foster e-commerce growth. [86] Recently, however, the government has passed legislation to have filtering software 66 installed on all computers in public places such as libraries and schools. [64] It seems that the years of a relatively free Internet in South Korea have ended, and the more conservative elements of South Korean society have triumphed over that segment concerned with economic growth. Still, it is interesting to note that the perceived importance of e-commerce kept the Internet free for over seven years in South Korea. The United Kingdom has explicitly stated that it wishes to provide a 'light regulatory touch' in order to promote e-commerce. It has ignored calls to censor content and instead relies on existing laws to punish illegal content. [86] This standpoint shows how important the United Kingdom views an uncensored Internet as being to the growth of the e-commerce sector. The United States enjoys strong free speech protection within its Constitution, and these rights have been at the core of attacks to any Internet censorship bills that have been proposed. However, a significant argument made against proposed bills such as the Communications Decency Act and the Child Online Protection Act is the adverse effect on e-commerce that such legislation would have. [69] Economists are routinely asked to comment on how the restrictions contained in these bills would affect e-commerce, and the universal answer is a resounding negative effect. With the strongest e-commerce environment in the world, the United States as a whole has been wary of allowing legislation that may slow this growth - although the government has not given up on the idea. While Vietnam has a seemingly very restrictive policy with regards to the Internet, on closer inspection it is not as restrictive as it could be. It admits to censoring sites dealing with controversial political views, but the censorship is not very thorough as many sites get 67 through. This is not a mere oversight, as it is more likely that the government allows basically unfiltered access in order to encourage adoption of this new technology by the population. [59] Vietnam has historically been quick to adopt new technologies, and it seems in this case it wishes to establish the Internet, with the long-term goal of fostering e-commerce growth. 4.2.3 Negligible Effect There are many countries where the Internet is not mature enough for the issue of censorship to arise. Most of these countries have other more pressing needs to address, ranging from recent wars or the threat of future wars, abject poverty, lack of technology, etc. As pertains to the countries surveyed in this paper, the following countries have not addressed the issue of free speech on the Internet: Brazil, Indonesia, Iran, Iraq, Mexico, Nigeria, Philippines, South Africa, and Sri Lanka. Beyond the above countries which are at an earlier stage of Internet adoption, there are many countries where e-commerce concerns have not been considered when adopting Internet speech policies. The reasons for ignoring the e-commerce sector vary widely; from censorship not being an issue to the other extreme where e-commerce concerns are explicitly ignored in order to uphold the values that the government deems important to their society. Canada and Israel both have strong free speech ideals and have kept the Internet relatively uncensored, while using existing laws to punish illegal content. The Internet has not been kept free specifically because of e-commerce concerns, but more because of the ideals that their respective societies hold with regards to free expression. Sweden is the one country surveyed where there is both a thriving e-commerce 68 environment and no censorship of any kind. Censorship is not an issue in Sweden and the government has gone to great lengths to make sure everyone has access to the Internet with no restrictions. The freedom given to the Internet is more a reflection of the attitudes of Swedish society than an assertion of the importance of freedom of speech to e-commerce. Germany and France have both decided to apply their existing hate speech laws in very broad ways to the Internet. So broad, in fact, that in some cases they hope to apply their laws to web-sites outside of their borders. Clearly the potential harm they might do to their e-commerce environment is not an issue in these countries. Pakistan and Saudi Arabia both funnel all Internet content through government portals that filter out pornographic, political, and anti-Islamic material before it reaches the user. These countries are not concerned about the possible negative affect these harsh restrictions might have on e-commerce, they are more concerned with upholding the morals of their respective societies. China initially funneled all Internet content through government servers to block sites deemed objectionable. As it realized the economic potential of the Internet, it gradually lessened its control. This lasted until the year 2000, when China started rolling out more and more legislation designed to allow the government to regain control of the Internet. [76] The government is not concerned with the possibility that e-commerce will suffer due to these restrictions; it is more concerned with regaining control. China is potentially a huge Internet market, and the government seems content in forcing businesses to do things its way rather than in accepting a free and open Internet for its citizens. Australia is an interesting case of where e-commerce concerns have been completely 69 ignored and freedom of speech has been compromised with gusto. The federal government has created a system for citizens to lodge complaints against 'offensive' sites, and at least one state government has banned adult-oriented web-sites completely. [5,87] When questions were asked as to the effect of these restrictive policies on the e-commerce landscape, a government official pointed to Malaysia and Singapore as countries with very restrictive policies where e-commerce is thriving. [4] Ironically, both Malaysia and Singapore have drastically scaled back their restrictive policies specifically due to e-commerce concerns. Both countries started out by filtering all content through government portals in order to filter out objectionable material; Singapore now only filters out about 100 sites, and Malaysia has pledged to keep the Internet free of censorship. [70,34] It remains to be seen if Australia realizes how much potential damage it could do to its e-commerce sector and relaxes its policies. 4.3 Timeline of Control So far we have seen how e-commerce concerns can affect the free speech policies of many countries; we now turn our attention to the timing of changes in free speech policies. It is interesting to survey those countries that moved from a restrictive Internet free speech policy to a free and open one, and vice-versa. In particular the timings of such shifts in policy are important. Many countries are not included in this discussion because their policies have remained relatively unchanged since embracing the Internet. These countries are: Argentina, Canada, Germany, Hong Kong, Israel, South Africa, and Sweden. This is not to say that all 70 of these countries have a completely uncensored Internet, only that their policies have been consistent since the Internet was brought into the country. Other countries where the Internet is not mature enough to consider their paths are: Brazil, Iran, Iraq, Mexico, Nigeria, and Sri Lanka. The first class of countries are those which have gone from centrally-controlled content filtering to a much more liberal free speech policy. Of the countries surveyed in the last chapter, Jordan, Malaysia, Singapore, and Vietnam fit this profile. Jordan and Malaysia went from content-filtering to no censorship of any kind, while Singapore and Vietnam both reduced their content-filtering considerably. In all cases the easing up of restrictive policies was done explicitly to help foster e-commerce growth. This seems to be a common path of more conservative countries; when first introduced, the Internet is seen as something that needs to be tightly controlled, but when e-commerce is recognized as important to the economy the restrictions are largely eased. Pakistan and Saudi Arabia also both filter content through government portals, but the Internet is relatively new in these countries so as e-commerce becomes more important to their economies they may follow the same path as other conservative countries and open up the Internet. The second class of countries are those which went from (or are going from) a liberal free speech policy to a more restrictive one. Australia, France, South Korea, Spain, the United Kingdom, and the United States fit this profile, although to varying degrees. In all cases the Internet has been accessible for many years and has been kept uncensored, but recently the governments have passed legislation designed to bring the Internet back into some form of control. Australia, South Korea and Spain are at one extreme where new 71 policies drastically curtail free speech on the Internet, while France has recently started applying its existing laws to the Internet on a large scale. The United Kingdom is on the verge of restricting free speech drastically, while the United States can also be argued to be following this profile since it is making attempts to control access to objectionable material. In all of these countries it is likely that one of the reasons that the Internet was allowed to be free for a significant amount of time was to allow the e-commerce sector time to develop. Once an infrastructure was in place, the respective governments decided to start exercising more control over content. There are other countries in an earlier stage of Internet maturity that may follow this same path, in particular India, Indonesia, the Philippines, and Russia. All of these countries currently have a relatively uncensored Internet, but are likely to push for more control once a strong e-commerce foundation has been laid. China has not followed either of the above paths, and has not remained the same since first embracing the Internet either. It went from full government control to a less restrictive system, and is now successfully enacting legislation to regain control of the Internet again. China seems to be an outlier case because of its sheer size and conviction to do things its own way. E-commerce concerns have not been central to the decision-making process; China is more concerned with keeping the Internet under tight control. 4.4 Summary As seen in the above discussion, e-commerce concerns can have a strong influence on the choice of free speech policy, as well as the timeline of changes to these policies. These 72 concerns can open up the Internet in restrictive countries where governments filter out controversial material, or they can delay the adoption of restrictive policies in others. Regardless, all countries seem to acknowledge the importance of e-commerce at some point in their Internet development and make changes to their online speech policies accordingly. 73 Chapter 5 Conclusions The free speech policies chosen by a particular country are the product of many factors, including the religious and cultural heritage of the people, the ideals the government wants to uphold, and economic concerns. The Internet presents a unique opportunity to engage in new models of commerce that have never been seen before, but this power is a double-edged sword. Along with electronic commerce activities, a plethora of other, possibly offensive, material is available on the Internet, and each country must make decisions on how much control to exercise over it. The desire to foster the growth of the e-commerce sector can indeed have a strong effect on the free speech policy that a country chooses. It can keep the more conservative elements of society who want strict controls at bay for a significant amount of time, or it can break down existing controls in order to reap economic benefit. Rarely are economic concerns completely ignored; all countries acknowledge the importance of e-commerce to their economy at some point in their Internet development. Countries differ in their levels of Internet maturity, and subsequently their free speech policies also vary. There is no single path that the free speech policy of a particular country will follow, but there are noticeable trends. Countries will generally follow one of three paths: start with a restrictive policy and then relax it to foster economic growth, start with an 74 open policy and then bring in restrictions once the e-commerce sector is developed, or maintain a consistent free speech policy over time. These are not the only possibilities; however, all but one of the countries surveyed in this thesis that had a mature Internet environment were on one of these paths. The results for the countries surveyed in Chapter 3 are summarized in Table 5.I.1 Path Restrictive To Open Open To Restrictive Free Consistent Free Free Speech Policy Speech Policy Speech Policy Countries Jordan Australia Argentina Currently Malaysia France Canada On Path Singapore South Korea Germany Vietnam Spain Hong Kong United Kingdom Israel United States of America South Africa Sweden Countries Pakistan India N / A That May Saudi Arabia Indonesia Follow Philippines Path Russia Table 5.1: Paths of Free Speech Policies Since free speech policies are constantly evolving, future work in this area should focus on updating the policies for countries surveyed in this thesis. It will be interesting to see if countries that were shown to be at a particular stage of a path actually do follow the 1 Those countries surveyed in Chapter 3 that do not have a mature Internet environment are not included in Table 5.1: Brazil, Iran, Iraq, Mexico, Nigeria, and Sri Lanka. 75 path over time. As more countries come online and start tapping the economic potential of the Internet, they can be analyzed as in this thesis and the path of changes to their free speech policy predicted. This thesis has shown the importance of e-commerce concerns to the free speech policy chosen by a particular country; this should not be overlooked in future discussions of freedom of expression on the Internet. 76 Bibliography [1] ACLU Ready For Second Supreme Court Battle Over Internet Censorship Law. American Civil Liberties Union, May 21, 2001. Accessed from the Web page with URL: on July 5, 2001. [2] K. Ahmed. Secret Plan To Spy On All British Phone Calls. The Observer, December 3, 2000. 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