Internet intermediaries such as ecommerce, payment, and social media platforms help individuals and companies find, share and access content as well as interact and transact with one another. This improves growth and productivity of other firms in the economy. Copenhagen Economics found internet intermediaries increased EU GDP by €430 billion in 2012, or about 3.3 percent of EU’s GDP. This increase in GDP is made up of €220 billion in investment, private consumption, and export gains, €210 billion indirect productivity increases in firms serviced by intermediaries. The EU also gained €640 in consumer benefits from free services, increases in online advertising, and B2B platform revenues.
Unclear and restrictive liability and copyright regulations deter investors. Regulations holding internet services liable for user-generated content are found to reduce the pool of investors for such services by 81 percent. Clarifying copyright regulations allows websites to resolve legal disputes quickly and expands the pool of interested investors by 111 percent. Limiting penalties for websites acting in good faith expands the pool of interested investors by 115 percent.
Several countries have sought to clarify the liabilities of platforms and their users by establishing liability laws, known as “safe harbors”, that provide internet intermediaries partial immunity from the conduct of their users, such as posts with content that violate third-party copyrights.
The Brazilian safe harbor established in the 2014 Marco Civil Internet “Bill of Rights” is widely viewed as a global best practice. The regime is analogous to Section 230 of the Communications Decency Act in the United States, which is considered critical to the growth of American online platforms. It protects Internet service providers (ISPs) and Internet application providers (IAPs), such as social media websites and search engines for third-party content, from civil liability arising from damages related to hosted content.
Internet intermediaries are seen under the Brazilian law as conduits of information, not its generators. The law establishes that ISPs providers are not liable for content generated by a third party unless they fail to act upon specific judicial notice to remove infringing or other content. Sexual content and nudity are exceptions – internet providers are liable if they fail to remove this type of content at the request of the injured party.
Marco Civil is a hard-won compromise between various interest groups, such as Internet companies and civil society. The two groups engaged in a participatory, multi-year drafting procedure that was partially carried out online. The process is considered the key to the law’s success and implementation: every interest group gave something and got something in return. The law also provided a clear template to courts which had previously issued conflicting rulings on online copyright infringements.
The law has also been applauded for striking a balance between copyright enforcement and freedom of expression, and for protecting citizens’ rights by preventing the government from pressuring platforms or regulating content without judicial due process that proves content infringes on other rights.
Many countries in the Americas such as Canada, Mexico, the United States and Chile have similar laws. For example, Chile’s copyright law of 2010 also specifies that internet intermediaries are not liable for user content on their sites if they take appropriate actions in response to judicial orders.