By Matthew Lasar
PayPal has joined a music copyright association and the City of London police department's bid to financially starve websites deemed "illegal." When presented with sufficient evidence of unlicensed downloading from a site, the United Kingdom's PayPal branch "will require the retailer to submit proof of licensing for the music offered by the retailer," said the International Federation of the Phonographic Industry's latest press release.
The company will then "discontinue services to retailers in cases where licensing appears to be inadequate." The announcement comes with the requisite gung-ho statement from Carl Scheible, PayPal UK's managing director.
This shows that PayPal is "very serious about fighting music piracy," Scheible explains. "We've always banned PayPal's use for the sale of content that infringes copyright, and the new system will make life even harder for illegal operators. Our partnership with the music industry helps rights holders make money from their own content while stopping the pirates in their tracks."
Expeditious enforcement
MasterCard and Visa are already on board this initiative, originally unveiled in March. The process works like this: IFPI submits allegedly infringing websites to the City of London police department's Economic Crime Directorate. Once the division has "verified the evidence," it passes the information on to MasterCard, Visa, and now PayPal.
The card providers then "require the acquiring bank providing the retailer with payment services to produce evidence of appropriate licenses to sell music or cease providing those services to the retailer," IFPI explains. MasterCard has promised to respond to law enforcement requests "expeditiously."
According to the group, industry anti-piracy experts have also composed a set of "best practice procedures" for MasterCard and Visa "to distribute both internally and to banks that use their services, which help identify infringing websites and prevent them from being granted card payment facilities."
This alliance appears to be primarily targeted at sites based in Russia and the Ukraine. Getting banks to cut off credit card support was crucial to the crusade against Russia's AllOfmp3.com music download service several years ago (that, and forcing Russia to crack down on Allofmp3.com as a condition for joining the World Trade Organization).
In March, IFPI said that 24 suspect online music outlets had already been turned over to the cops. Looks like the trade association has gotten a 100 percent conviction rate for its trouble.
"Since the March announcement with MasterCard and Visa, their payment services have been withdrawn from 24 illegal music services," the latest announcement adds. And since then, IFPI investigators have submitted the details of another 38 sites "suspected of infringing copyright on a grand scale."
We pinged Alex Jacob, IPFI media contact, for a list of these sites. "I think it's probably best that the City of London Police answer your question on the site names as they will know which are clear of any ongoing investigation," he explained. The London Police didn't reply to our inquiry.
In any event, now PayPal is part of the mix, and its involvement is applauded by the authorities.
"We are fully committed to proactive initiatives such as these where we work with the private sector to prevent offending, stop legitimate business services such as PayPal being exploited by criminals and minimise harm to entire business sectors such as the music industry," Detective Chief Superintendent Steve Head of the City of London Police added in the IPFI announcement.
"The benefits are palpable not only in terms of delivering an effective response to victims and the business community as a whole, but also in enabling the City of London Police Economic Crime Directorate to maximise our resources in tackling a wide range of criminality."
Your honor?
The real question is whether, at any time in this process, the City of London submits the evidence of infringement or some aspect of the process to a court for review. The ECD has a history of working with the Metropolitan Police Film Piracy Unit, long at the service of the movie industry's Federation Against Copyright Theft.
FACT aided UK law enforcement to prosecute the famous Filesoup file sharing site. The police eventually dropped that case, conceding that the legal basis for a criminal trial wasn't there.
But in this announcement, neither IFPI or the City of London police department mention any judicial body which the authorities consult on the "illegality" of a site. We asked IFPI's Jacob about this. Does any judge appear in the mix? Is there any judicial sign-off at any point in the process?
The answer:
The removals are considered by MasterCard, PayPal, and Visa and it is their commercial decision to terminate merchant accounts based on a request from the police and their own due diligence processes. The police check and verify all evidence submitted by rights holders.
UK PayPal public relations person Rob Skinner explained the procedure to us as follows:
"The way the new process works is that we will require proof from a seller of music via PayPal that they have the necessary licensing in place for the sale of music," Skinner explained. "In other words, we’re looking for proof of the right to sell, rather than proof of infringement, but we do also have a notification system for rights owners to report cases of alleged copyright infringement."
Back in March, we asked IFPI for details about those "best practices."
"As these include advice to help payment providers on how to identify signs of illegal activity," we were told, "you would not expect them to be published so that those engaging in such business could be aware of how to hide their activities."
The proposed PROTECT IP Act—with its provisions allowing the government to crack down allegedly infringing sites and search engines—has a court order mechanism and requires judicial sign-off. But by framing this issue as a private merchant dispute with a payment processor, the new scheme avoids the need for such oversight.
PayPal has joined a music copyright association and the City of London police department's bid to financially starve websites deemed "illegal." When presented with sufficient evidence of unlicensed downloading from a site, the United Kingdom's PayPal branch "will require the retailer to submit proof of licensing for the music offered by the retailer," said the International Federation of the Phonographic Industry's latest press release.
The company will then "discontinue services to retailers in cases where licensing appears to be inadequate." The announcement comes with the requisite gung-ho statement from Carl Scheible, PayPal UK's managing director.
This shows that PayPal is "very serious about fighting music piracy," Scheible explains. "We've always banned PayPal's use for the sale of content that infringes copyright, and the new system will make life even harder for illegal operators. Our partnership with the music industry helps rights holders make money from their own content while stopping the pirates in their tracks."
Expeditious enforcement
MasterCard and Visa are already on board this initiative, originally unveiled in March. The process works like this: IFPI submits allegedly infringing websites to the City of London police department's Economic Crime Directorate. Once the division has "verified the evidence," it passes the information on to MasterCard, Visa, and now PayPal.
The card providers then "require the acquiring bank providing the retailer with payment services to produce evidence of appropriate licenses to sell music or cease providing those services to the retailer," IFPI explains. MasterCard has promised to respond to law enforcement requests "expeditiously."
According to the group, industry anti-piracy experts have also composed a set of "best practice procedures" for MasterCard and Visa "to distribute both internally and to banks that use their services, which help identify infringing websites and prevent them from being granted card payment facilities."
This alliance appears to be primarily targeted at sites based in Russia and the Ukraine. Getting banks to cut off credit card support was crucial to the crusade against Russia's AllOfmp3.com music download service several years ago (that, and forcing Russia to crack down on Allofmp3.com as a condition for joining the World Trade Organization).
In March, IFPI said that 24 suspect online music outlets had already been turned over to the cops. Looks like the trade association has gotten a 100 percent conviction rate for its trouble.
"Since the March announcement with MasterCard and Visa, their payment services have been withdrawn from 24 illegal music services," the latest announcement adds. And since then, IFPI investigators have submitted the details of another 38 sites "suspected of infringing copyright on a grand scale."
We pinged Alex Jacob, IPFI media contact, for a list of these sites. "I think it's probably best that the City of London Police answer your question on the site names as they will know which are clear of any ongoing investigation," he explained. The London Police didn't reply to our inquiry.
In any event, now PayPal is part of the mix, and its involvement is applauded by the authorities.
"We are fully committed to proactive initiatives such as these where we work with the private sector to prevent offending, stop legitimate business services such as PayPal being exploited by criminals and minimise harm to entire business sectors such as the music industry," Detective Chief Superintendent Steve Head of the City of London Police added in the IPFI announcement.
"The benefits are palpable not only in terms of delivering an effective response to victims and the business community as a whole, but also in enabling the City of London Police Economic Crime Directorate to maximise our resources in tackling a wide range of criminality."
Your honor?
The real question is whether, at any time in this process, the City of London submits the evidence of infringement or some aspect of the process to a court for review. The ECD has a history of working with the Metropolitan Police Film Piracy Unit, long at the service of the movie industry's Federation Against Copyright Theft.
FACT aided UK law enforcement to prosecute the famous Filesoup file sharing site. The police eventually dropped that case, conceding that the legal basis for a criminal trial wasn't there.
But in this announcement, neither IFPI or the City of London police department mention any judicial body which the authorities consult on the "illegality" of a site. We asked IFPI's Jacob about this. Does any judge appear in the mix? Is there any judicial sign-off at any point in the process?
The answer:
The removals are considered by MasterCard, PayPal, and Visa and it is their commercial decision to terminate merchant accounts based on a request from the police and their own due diligence processes. The police check and verify all evidence submitted by rights holders.
UK PayPal public relations person Rob Skinner explained the procedure to us as follows:
"The way the new process works is that we will require proof from a seller of music via PayPal that they have the necessary licensing in place for the sale of music," Skinner explained. "In other words, we’re looking for proof of the right to sell, rather than proof of infringement, but we do also have a notification system for rights owners to report cases of alleged copyright infringement."
Back in March, we asked IFPI for details about those "best practices."
"As these include advice to help payment providers on how to identify signs of illegal activity," we were told, "you would not expect them to be published so that those engaging in such business could be aware of how to hide their activities."
The proposed PROTECT IP Act—with its provisions allowing the government to crack down allegedly infringing sites and search engines—has a court order mechanism and requires judicial sign-off. But by framing this issue as a private merchant dispute with a payment processor, the new scheme avoids the need for such oversight.
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