Finland gets tough on privacy, with new law to give Apple, Facebook messages total security

Finland is cracking down on social media and online messaging providers ahead of a big European Union review.

New year, new legislation: for Finland, 2015 has started with a bang.

On 1 January, the 'Information Society Code' passed into law. The Code is a major new umbrella act revising the country's electronic communications legislation, which has four main goals: simplifying existing rules; improving consumer protection; boosting information security; and creating more equal telecoms markets.

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The Code's number-crunching is impressive: it's consolidated 10 existing acts into one, and cut their 490 sections to 350.

On an administrative level, the Information Society Code is already being seen as a success. "Codifying several existing laws in this field into one extensive package is not common internationally and in this respect the Code is unique," says Iiro Loimaala, lawyer at Bird & Bird Attorneys.

However, the Code's biggest worth lies elsewhere.

Higher standards for Facebook

The greatest potential consequence of the Information Society Code comes from its increased regulatory powers over the information society. Most notable is the new requirement to ensure confidentiality of communications rules apply to all electronic communication distributors, including social media companies.

"The new law also covers OTT [over-the-top content] players as far as privacy and security provisions are concerned," says Olli-Pekka Rantala, director of the communications market at the Finnish Ministry of Transport and Communications. "The provisions would apply to such matters as confidential messages exchanged via social media. This is a small step towards a level playing field between traditional telecom operators and new internet players but it was a big change in principle."

In practice, it means the likes of Apple, Facebook, and Twitter must now make sure users of their messaging services get the same standards of privacy and security as other, already regulated, sectors such as telcos and value added service providers.

In addition, the scope of legislation regarding confidentiality of communications and online privacy (amongst other areas) has increased to cover companies based outside the EU but offering services in Finland.

While the Code is in line with the current EU legislation, Finland is something of a pioneer in extending the legislation's scope. According to lawyers Bird & Bird, the Code resembles the approach taken by the General Data Protection Regulation, currently under consideration in the EU.

A telecommunications equaliser

The Information Society Code also takes consumer protection a step further by introducing joint liability for telcos and services providers.

For example, when a consumer buys a product or service with their mobile phone and payment is taken by their telecoms provider, the telco will share accountability with the company selling the product or service, in a similar way as when using a credit card. This means that if problems with the purchase arise, the consumer can turn to either of the companies for help.

On top of this, the Information Society Code also stipulates that "telecom operators are obligated to tell their clients about and offer them universal service products more actively than before".

'Universal service products' in Finland cover both basic telephony services and internet access with a minimum speed of 1Mbps. Operators must now make greater attempts to offer these products, rather than just more expensive options.

For companies in telecommunications, the new act doesn't only bring extra obligations, but also simplifies the operating licence procedures and aims to create a more equal market.

"A significant part of television and radio licensing decisions was transferred from the government to the Finnish Communications Regulatory Authority [FICORA]," Rantala explains. "As far as mobile licences are concerned, new frequency bands can be distributed via auction while previously 'beauty contests' [comparative bidding] was the usual way and auctioning always required a specific law."

Separately, price monitoring of operators which hold "significant market power" has been made more efficient, says Rantala. FICORA now has the right to intervene in pricing and determine a maximum price for a telecommunication operator's wholesale products when competition issues arise.

EU review under way

But the Information Society Code has its critics. Bird & Bird's Loimaala points out that it will take time to judge how well the act has actually functioned in revising past legislation.

"Despite some fixes to the current regulation we should note that the Code also is a codification exercise compiling existing laws together," argues Loimaala. "Significant amendments to the contents of the legislation may be introduced later and, for instance, due to other pending reforms such as the General Data Protection Regulation proposed by the European Commission."

Still, in big picture terms, the Information Society Code appears to represent positive progress.

"Trust in the internet will be a key issue for the future development," says Rantala. "In this respect, it's crucial that the same level of protection can also be safeguarded to new types of communication. Finland was a front-runner when deciding to extend the scope of the law."

In short: your move, EU.

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