Government releases USO review terms, website blocking guidelines

The Australian government has released a terms of reference statement detailing the process by which the funding and regulatory arrangements for the Universal Service Obligation (USO) will be reviewed, as well as a set of draft guidelines for government agencies to adhere to when blocking websites.

Australian Treasurer Scott Morrison on Thursday morning formally requested that the Productivity Commission undertake an inquiry into the USO.

The USO, which mandates Telstra as the fixed-line phone service provider of last resort, is facing government reform thanks to the Regional Telecommunications Independent Review, which made 12 recommendations on how the government can improve regional access to telco services to leverage connectivity for business, education, health, and personal purposes.

In response to that report, the government acknowledged that the USO is outdated due to the prevalence of mobile services, and consequently needs to be reviewed.

Morrison's terms of reference pointed out that while mobile services are increasingly in demand, the use of standard fixed-line services are declining. He added that as the National Broadband Network (NBN) is rolled out across the country, it will instead become the provider of last resort.

"In the context of these and other changes, the current USO arrangements may not be effective," the treasurer said.

The scope of the inquiry will see the Productivity Commission address the USO's nature, scope, and objectives, and whether the retail market can deliver "appropriate outcomes" in terms of competitively priced ubiquitous access to services without government involvement.

The commission must consider what arrangements should be made to ensure all sections of the community are provided for, who should bear the cost of this, the funding model best suited to such intervention, and arrangements from transitioning from the present USO model.

In making its report, the commission has been directed to have reference to the Regional Telecommunications Review, the government's response to that review, similar approaches being taken in comparable countries, and any public submissions made on the matter.

The Australian Communications Consumer Action Network (ACCAN) welcomed the publication of the terms of reference, saying it is important to ensure the government provides for the changing use of technology in telecommunications.

"We look forward to participating in the inquiry and working with the government and the commission to ensure that the consumer voice is represented as we look to update the USO to move in line with the evolving market and the technology that we're now using," ACCAN said in a statement.

"ACCAN believes that all communications services should be available, accessible and affordable for all consumers."

The Productivity Commission's final USO report is due in April 2017.

The federal government has also released its draft guidelines for the use of Section 313(3) of the Telecommunications Act 1997 by government agencies for the lawful disruption of access to online services in response to the June 2015 report Balancing Freedom and Protection, Inquiry into the use of subsection 313(3) of the Telecommunications Act 1997, laying out whole-of-government guidelines for the use of website blocking.

The guidelines broach a summary of best practice for government officers to abide by when using s313(3) to compel internet service providers (ISPs) to block access to certain websites that contravene Australian law.

These guidelines involve: Gaining authority from the agency head before blocking websites, as well as ensuring the request is approved by a Senior Executive Service (SES) officer or their equivalent; ensuring the blocks are "as targeted as possible", with ISPs to be consulted prior to requesting a block; devising and documenting internal guidelines for requesting a website block, including specifying the period of time for the disruption and monitoring and appraising of any blocks; only blocking websites when they commit a serious criminal or civil offence, or constitute a national security threat; ensuring the public is informed of the block and the reasons behind it in a timely manner through online posts, media releases, stop pages, and annual reports; instituting a process for complaints and reviews; and ensuring that those with "the appropriate technical expertise" are accessible for the agency to consult.

In determining whether a website block is "appropriate", the report recommends considering costs; technical feasibility; the nature of the website and its offences; possible consequences or damage to the government; the ISP's perspective on the matter; whether other enforcement tools are available; and the public and national interest.

The government came under fire in April 2013 when the Australian Securities and Investments Commission (ASIC) used its s313 power and accidentally blocked 250,000 websites in the process.

"Our internal review identified that the ASIC teams requesting s313 blocks were not aware that a single IP address can host multiple websites," ASIC later stated.

As such, the guidelines now provide that blocks are to occur through URLs rather than IP addresses.

"When making a request, agencies should endeavour to make it as targeted as possible. This usually means requesting that a Uniform Resource Locater (URL) -- the specific address of a website -- be blocked, rather than Internet Protocol (IP) addresses," the guidelines say.

"IP addresses generally host multiple websites; requests to block these risks disrupting access to non-target websites."

The guidelines also suggest that all agencies "should have the requisite level of technical expertise, or procedures for drawing on the expertise of other agencies or external experts".

"This will help ensure that a request is effective, responsible and executed appropriately," the guidelines conclude.

In July 2014, then-Communications Minister Malcolm Turnbull established an inquiry into the lack of transparency and oversight of s313(3) following ASIC's revelation that it had used the power 10 times in one year to block scam financial websites.

The parliamentary Standing Committee of Infrastructure and Communications, which then reviewed s313(3), was told during a public hearing in March last year that independent oversight should be implemented to prevent the power from being abused by government.

"Section 313 is a source of significant concern to us and our members," Internet Society of Australia non-executive director and executive office of Electronic Frontiers Australia (EFA) Jon Lawrence told the committee hearing.

"We believe its vague wording and broad scope have far-reaching potential for misuse and abuse. We believe it represents a potentially dangerous impediment to internet freedoms."

Despite this, in June 2015 the parliamentary committee recommended that government agencies retain their power to compel ISPs to block websites, but said there should be improved transparency and accountability.

Websites can now also be blocked by rights holders through the Federal Court under Section 115A of the Copyright Amendment (Online Infringement) Act 2015 if they are deemed to exist for the primary purpose of infringing or facilitating infringement of copyright, thanks to legislation that both houses of parliament passed in mid-2015.

Australian pay TV provider Foxtel and media company Roadshow Films are currently involved in a court case against several ISPs to block five foreign piracy websites including The Pirate Bay, while Universal Music Australia, Sony Music Entertainment Australia, Warner Music Australia, and J Albert & Son filed a joint Federal Court application earlier this month to get ISPs to block Kickass Torrents.