eco – A Look Back at 2017: Internet Policy without a Governing Concept

The three most important digital policy developments in Germany in 2017

The year 2017 was dominated by Germany’s federal elections in September and the preceding election campaign, which also made itself felt in some of the federal government's decisions on Internet policy shortly before the end of the eighteenth legislative term.

But what was actually achieved in 2017 in Internet and digital policy in Germany? eco – Association of the Internet Industry takes stock and looks back at the three most important digital policy developments and decisions of the last 12 months. In so doing, the association warns against weakening Germany's position as a digital location and growth driver of the Internet industry through too many restrictions and regulations. At the same time, eco calls for political decision-makers to focus once more on the opportunities and potentials of digitalization for society and the economy, and not to further undermine trust in digital services through excessive surveillance measures.

“We have experienced a less visionary Internet policy from the grand coalition in both this and the preceding year, in so far as the subject of digitalization was dealt with in a very problem-oriented manner. There was no governing concept as to how the digital transformation of Germany should look for the benefit of all. As a result, the German government did not take a very proactive approach to Internet-related questions, but rather let itself be driven by hyped topics, such as hate speech and fake news,” Chairman of the Board at eco, Oliver Süme, said late last year. “For the next year and from the new government, I would like to see a greater focus on the creation of constructive and economically meaningful framework conditions for the development, marketing, and use of the Internet and digital technologies, rather than the pursuit of an actionist regulatory and containment policy that tackles symptoms rather than causes,” Süme stated.

Retrospective: the three most important digital policy developments in 2017

1. Statutory control and surveillance: Blanket data retention, State Trojans and website blocking

The introduction of the changes to the Data Retention Act, which came into force in December 2015, featured as a much-discussed issue once again in 2017, owing to the onset of the obligation to retain data in July 2017. Many legal questions are still heavily disputed and several lawsuits are ongoing. In addition to the cases brought before Germany’s Federal Constitutional Court in Karlsruhe, a lawsuit was also filed by SpaceNet AG before the Administrative Court in Cologne, an action supported by eco. In this matter, the Higher Administrative Court of North Rhine-Westphalia concluded in a resolution of 22 June 2017 that blanket data retention does not comply with EU law. As a result, the German Federal Network Agency for Electricity, Gas, Telecommunications, Post and Railway has suspended the enforcement of the retention obligation for all companies until the conclusion of the main proceedings. Until then, no regulations or measures can be initiated, and no fines against obligated companies for the non-implementation of blanket data retention can be processed. Legal certainty must now be established here as soon as possible. The current state of limbo is unacceptable for the economy – a condition that cannot be desired by legislators.
Although the European Court of Justice (ECJ) declared as recently as December 2016 that blanket data retention without cause is incompatible with European fundamental rights, the EU Council has also not deviated from its plans for European-wide data retention.

eco also regards the “Act for More Effective and Practical Structuring of Criminal Proceedings”, which came into force in August 2017, as representing an attack on IT security and fundamental Internet freedoms. This legislation allows the deployment of so-called “State Trojans” to enable German prosecution authorities to hack computers, to bug smartphones, and to read messages from messenger services (such as WhatsApp). For eco, this legislation is highly questionable, not only from a constitutional point of view, but also in terms of IT security. The deployment of State Trojans is fraught with extreme danger because it compromises the IT security of all users.

The association instead calls for the stricter implementation of IT security management, not only by companies, but especially by government and its authorities. This also means a clear rejection of so-called zero-day exploits. As long as public bodies, intelligence services, and security authorities do not report existing vulnerabilities, but instead exploit them to spy on citizens, easily-preventable cyber attacks will take place. At the same time, this weakens the general IT security infrastructure and exposes citizens to unnecessary risks.

Another unfortunate chapter was also opened this year in the area of Wi-Fi third party liability. In the summer of 2017, the German Bundestag adopted the 3rd amendment of the German Telemedia Act (TMG), also known as the Wi-Fi Act. Whilst this amendment abolished the frequently criticized Wi-Fi third party liability in Germany, it also created at the same time a legal foundation for “website blocking on demand” and thus misses its actual target of providing legal security for Wi-Fi operators. In this context, eco criticizes in particular the creation of new legal uncertainties through the introduction of website blocking without prior judicial decisions. In eco’s opinion, the law should be revised in the forthcoming legislative term. Similar trends are currently taking place at EU level, where website blocking for consumer protection is to be implemented. It is eco’s view that this development is harmful and should not be further pursued, as it undermines the fundamental freedom principles of the Internet.

2. The NetzDG (Network Enforcement Act or “Act for the Improvement of Law Enforcement in Social Networks”): Constitutionally doubtful, gateway for overblocking

The debate that erupted in 2016 concerning the fight against hate speech and illegal content on social media platforms, as well as the announced intention by the German Minister of Justice Heiko Maas to make platform providers more accountable, culminated in 2017 in the highly controversial NetzDG being passed by the German Bundestag. On fundamental grounds, eco rejects this legislation. The association condemns in particular the uncertain scope of the law, as well as the 24-hour or 7-day deletion deadline for “manifestly unlawful” cases. This leads to an overblocking of content by platform operators and could thus endanger freedom of expression on the Internet.

Internet companies are unilaterally being made responsible for deciding on illegality or freedom of expression and, if necessary, for deleting comments from their platforms. This effectively results in the emergence of a private-sector organized parallel judicial system, one which operates independently of statutory criminal prosecution and the jurisdiction of the courts. Offenders will not be held accountable and victims will not be given justice. This stands in direct contravention of our legal system. eco urges the new federal government to rectify this legal policy mistake by repealing this law.

3. Future Internet policy: Higher status for a strategically important topic

From the Internet association’s perspective, one positive development is that the topic of Internet policy gained in relevance in the public media debate in the run-up to this federal election, as compared with the last federal election campaign. The most pressing Internet policy issues, such as digital infrastructure and data protection, were taken up in the electoral programs of the mainstream parties. eco therefore calls for the new German government to take greater account of the strategic importance of digitalization for Germany as a business location and to accord it appropriate prioritization as part of governmental work. In eco’s view, this should include the establishment of an Internet ministry for interdepartmental coordination of Internet policy issues, as well as the support of politicians specializing in Internet policy in the German Bundestag through, for example, the establishment of a responsible steering committee.

Moreover, eco calls for a new digital agenda with concrete and measurable target agreements for a rigorous and modern Internet policy in the coming legislative term. This is also in line with the wishes of the German public, as shown by a recent representative survey (only available in German), conducted in August 2017 by the opinion research institute YouGov on behalf of eco – Association of the Internet Industry. According to this study, 48 percent of Germans believe that responsibility for Internet policy issues should be consolidated in one ministry during the next legislative term.