* Draft law alarms Internet companies and civil groups
* Google says would affect company's business
* EU sources say Commission could start probe
By Daniel Flynn
ROME, Jan 26 Internet companies and civil
liberty groups have voiced alarm over a proposed Italian law
which would make online service providers responsible for their
audiovisual content and copyright infringements by users.
The draft, due to be approved next month, would make Internet
Service Providers (ISPs) like Fastweb FWB.MI and Telecom
Italia (TLIT.MI), and Web sites like Google's (GOOG.O) YouTube,
responsible for monitoring TV content on their pages, industry
It comes as Google's YouTube unit is engaged in a legal
battle with Mediaset (MS.MI), controlled by Prime Minister
Silvio Berlusconi. Italy's largest media group wants 500 million
euros in damages from YouTube for copyright infringement.
"As it is written at the moment ... the law would certainly
help Mediaset in the procedure it has open against Google,"
Paolo Nuti, president of the Italian Internet Providers
Association, told Reuters. However, he said he did not think the
law was written expressly for this purpose.
The proposed regulations would make Internet sites as liable
as television stations for their content and subject to hefty
fines by the AGCOM media watchdog, according to a 33-page draft.
"If this happens it would sweep away Internet 2.0," Nuti
said. "It would transform Internet platforms into judges or
Italy's parliament, which is holding consultations with
civil groups and Internet associations, is due to present a
non-binding opinion to Silvio Berlusconi's government by early
February. The draft decree only requires presidential approval.
Raffaele Nardacchione, director of the Asstel association of
telecommunications providers which represents ISPs like Fastweb
and Tiscali (TIS.MI), said the decree far exceeded the terms of
the original European directive by extending the definition of
audiovisual media to Internet firms and by tightening copyright.
Marco Pancini, senior European public policy counselfor
Google, said that if the decree remained unchanged it would
materially affect the company's business in Italy.
"The first step is to discuss this with Italian authorities
to try to find a solution and we think this is do-able," he told
Reuters. "The next step, if the law stays as it is, is going to
be to discuss this with the European authorities."
COMMISSION COULD INVESTIGATE
EU sources told Reuters on Tuesday the Commission could open
an investigation into the decree for infringing EU norms.
Even the head of AGCOM, Corrado Calabro, told reporters on
the sidelines of a parliamentary hearing on Tuesday the decree
should be revised because it would "deform" the EU directive.
The draft legislation has also raised criticism from freedom
of speech groups like Italy's Article 21, which said in a
statement the decree "deviously attacks the freedom to operate
on the Web" and would "block any possibility of modern
development of the country".
Italy has one of the lowest rates of ADSL Internet usage in
western Europe, according to the European Commission's 2009
Information Society Report. E-commerce is also struggling. Only
around 10 percent of Italians buy online compared with around 55
percent of Britons and Germans.
Industry officials warned the new decree would postpone the
development of the Web even further.
"Any Internet company will make investments where the
legislative system is economical and the opportunities for
investment are greatest," said Nuti.