DPRR Committee Report on Digital Economy Bill

This is a summary of the Delegated Powers and Regulatory Reform Committee Report on the Digital Economy Bill published on 22 December 2016 before the Bill entered the Committee Stage in the House of Lords.

The Report by the Committee addresses Parts 1-4 of the DEBill but only makes recommendations for the Part 2 on Digital Infrastructure and Part 3 on Online Pornography. No recommendations have been made for the Part 4 on Intellectual Property.

The Report can be accessed here.

Recommendations for the Part 3:

• Clause 17 (1) - power to designate age-verification regulator

The Committee criticised in the report that the identity of the age-verification regulator is not specified in the Bill. They have objections to the Secretary of State designating the regulator without any constraints. The Government stated that this has been done to allow for retaining flexibility to ensure the right person is appointed. However, the Report finds “flexibility” unsatisfactory as a reason.

Recommendation: The identity of the regulator should be specified on the face of the Bill.

Note: The Committee would find it acceptable for the Secretary of State to have powers to specify a different regulator if necessary.

• Clause 17 (4) - appeal arrangements

The Report finds it unsatisfactory that the regulator “will maintain arrangements for appeals against certain types of enforcement action”. The Committee criticised that there are no requirements for appeals to be made to an independent body or for details of the proposed appeal arrangements to be included in the particulars laid before Parliament.

Recommendation: Clause 17 (4) should be replaced with a statutory right of appeal on the face of the Bill.

Clause 15 (3), 21 (9) and 22 (7) - the regulator’s guidance In general, the Report criticises the lack of provisions for Parliamentary scrutiny of guidance published by the age-verification regulator.

• 15 (3) - guidance on the interpretation of clause 15 (1)

This section of the Report deals with the definition of pornographic material that prohibits a person from making pornographic material available on the internet on a commercial basis in the UK. The Committee pointed out that there is no definition of the “commercial basis”.

They object to a regulator having powers to impose fines, take enforcement actions and be able to specify key concepts used in the clause.

Recommendations: The Committee recommends to include a definition of the terms “commercial basis” and “not normally accessible” on the face of the Bill.

The Report suggests that flexibility can be attained by giving powers to the Secretary of State to give further detail on the definitions in regulations to be made by the Secretary of State. These regulations, according to the Report, are to be subject to the affirmative procedure (requires the formal approval of both Houses), and the negative procedure (does not require a debate) for subsequent regulations.

• 21 (9) - guidelines on financial penalties

The regulator will have a broad discretion to determine the level of penalties and is required to publish guidelines it proposes to follow on how to decide the amount of penalty.

Recommendations: The Report recommends to lay the guidelines for financial penalties before Parliament due to their highly influential nature.The Committee suggests to use the affirmative procedure for the initial guidelines, and the negative procedure for subsequent revised guidelines.

Note: These recommendations are based on the similar recommendations made to the Energy Bill (Clause 40).

• 22 (7) - guidance about services enabling or facilitating the making available of pornographic material or prohibited material on the internet

The Report points out that after the regulator gives a notice to a “payment-service provider” or to an “ancillary service provider”, the recipients of notices will not be required by law to take any action in response.

Clause 22 (7) enables the regulator to issue guidance about circumstances in which the regulator will treat services as enabling or facilitating the making available of pornographic material. The Committee criticises the lack of Parliamentary procedure associated with the guidance. They find it unsatisfactory that the definition of a key term should be only issued in the guidelines by the regulator.

Recommendations: The report recommends to set out the circumstances in which a person is to be treated as providing service which enables or facilitates the making available of pornographic material in clause 22. This is to done through the affirmative procedure and any subsequent changes through the negative procedure.

Note: The Committee suggested that the Government can try to convince the House of Lords that it might be impractical to include the circumstances in clause 22.