Brazil gives up on local data storage, demands net neutrality

In the latest chapter of Brazil's Marco Civil da Internet, Dilma Rousseff's government has backed down from its intentions to demand that companies store data locally in order to get opposition support to pass the country's first set of internet governance rules.

Despite being unhappy about the numerous delays around the voting of the Bill, the president agreed to postpone it once again to remove the requirement for local datacenters.

Even though Rousseff and key ministers had voiced their preference to enforce local storage following the NSA espionage scandal, the requirements were strongly criticized by businesses and the opposition - their point being that this could mean cost increases to users since companies would have to build local facilities.

The government may have given up on local storage demands, but will require that companies will be subject to Brazilian rules in case of legal disputes involving data, regardless of whether it is stored elsewhere.

"The question that is not negotiable is that the Brazilian law should be applicable to any data that has originated or circulates here in Brazil. Of course, having the data stored locally would make [the enforcement of the local regulations] easier," congressional relations minister Ideli Salvatti told Radio Estadão.

However, ditching local storage is not enough as net neutrality remains the most controversial point of the Marco Civil. Supported by the opposition, the telco industry wants to continue to base its business on data discrimination - this means setting higher or lower speeds according to individual internet usage patterns, load certain websites faster and also offer free access to certain content while charging for others.

While the government does not want to negotiate net neutrality, Dilma also wants to be able to regulate it by presidential decree after the Marco Civil is approved - but part of the government's supporter base and the opposition do not agree on that particular move.

Opposition leader Eduardo Cunha has said openly that a decree to regulate how telcos operate is a major annoyance, adding that this would get on the way of "freedom." However, the freedom cited by Cunha is more to do with business models rather than internet user rights.

The disagreements and the escalating tension between the opposition and the president's main ministers - particularly minister Salvatti, who was one of the main supporters of the requirement for local datacenters and was pushing for the voting of the Marco to take place yesterday - prompted the voting of the Bill to be postponed once again until next Tuesday (25).

The Marco Civil is now right at the center of a political battle involving interests that dig deeper than just guaranteeing civil rights in the use of the Internet - but Dilma wants to sanction it before April, when Brazil will be hosting a global internet governance event. However, time is short and the list of challenges appears to be getting longer.