E-Commerce Law Week, Issue 462

Antigua and Barbuda, Other Countries Seek Concessions from U.S. in WTO Gambling Dispute

As Antigua and Barbuda's long-running trade dispute with the United States enters its final stages, interested parties are preparing their end game.  As we previously reported, in March the World Trade Organization's compliance panel ruled that the United States had failed to meet earlier WTO demands to bring its treatment of online wagering on certain types of horse races into conformity with its obligations under the General Agreement on Trade in Services (GATS).  Now, alleging that America's failure to open its market to Antigua and Barbuda's online gambling services costs the Caribbean nation $3.443 billion annually, Antigua and Barbuda has asked the WTO's Dispute Settlement Body to offset these losses by freeing it from certain trade obligations toward the United States -- including those governing "communication services" under the GATS and several provisions of the Agreement on Trade-Related Aspects of Intellectual Property Rights.  Meanwhile, in an apparent attempt to sidestep the dispute, the U.S. has proposed modifying its GATS schedule to clarify that its market access commitments do not apply to online gambling services.  But even if the WTO accepts this move, the United States may still have to pay up.  Citing Article XXI of the GATS, which permits any WTO member affected by a modification of the agreement to negotiate for a "necessary compensatory adjustment," Canada, the European Union, India, Japan, Costa Rica, Australia, and Macao have reportedly also requested compensation talks with the United States.

SWIFT's Disclosures Stir Up a Stateside Suit

Last summer, the New York Times revealed that SWIFT, the Brussels-based international banking consortium, has been providing the U.S. Treasury Department with access to a global database of confidential financial transactions.  Since then, SWIFT has been the target of investigations worldwide, with some -- such as that of Canada's Privacy Commissioner -- finding few problems, while others -- such as that of the EU's Article 29 Working Party -- alleging serious violations of data protection laws.  Now, SWIFT could be facing scrutiny in the United States as well, thanks to Walker v. S.W.I.F.T. SCRL, a putative class action law suit brought in federal court in Illinois. The named plaintiffs allege that SWIFT disclosed their domestic and international transactions to the U.S. government "without consent or warrants," thereby violating the First and Fourth Amendments, the Right to Financial Privacy Act (RFPA), and the Illinois Consumer Fraud and Deceptive Business Practices Act.  In Walker, the court allowed the plaintiffs' Fourth Amendment and RFPA claims to go forward, but granted SWIFT's motion to dismiss the remaining counts for failure to state a claim.  While several of the plaintiffs' claims may stand on shaky legal ground, should the case reach discovery, SWIFT could face more probing scrutiny of its cooperation with U.S. authorities.

French Court Permits Peeping on P2P Users' IP Addresses

In 2005, we reported that the French data protection authority, the Commission Nationale de I'Informatique et Libertés (CNIL) had barred four music industry groups -- including the Société des Auteurs, Compositeurs et Editeurs de Musique (SACEM), and the Société Civile des Producteurs de Phonogrammes en France (SPPF) -- from using automated monitoring of users of P2P file sharing systems in their fight against piracy.  Last month, France's highest court of appeal for administrative decisions, the Conseil d'Etat, largely overturned this ruling, concluding that the groups' request to automatically track downloads of the 10,000 most popular songs in their combined catalogs would further legitimate anti-piracy interests that outweigh associated privacy concerns.  In response to the Conseil d'Etat's ruling, the CNIL restated its commitment to guaranteeing "the right balance between the protection of author's rights and of the private life of Internet users," and indicated that it will seek to rebuild a "constructive relationship" with the music industry groups.  Although we would like to take this spirit of compromise at face value, we certainly don't expect the court's decision to end the battles between the music industry and privacy interests over P2P file sharing in Europe -- where the law is generally less favorable to disclosure of subscriber information than it is in the United States.

Interconnected VoIP Providers Subject to FCC Disability, TRS, and 711 Dialing Rules

As we previously reported, the Federal Communications Commission announced on May 31, 2007, that it would extend existing disability-related rules for telephone carriers to interconnected Voice over Internet Protocol (VoIP) services.  On June 15, the FCC released a Report and Order explaining its decision.  In some respects, the FCC's action may be ill-timed; the Commission's requirements for disability access mirror the standards established by the Architectural and Transportation Barriers Compliance Board (better known as the "Access Board").  The Access Board, however, is currently undertaking a complete review of all of its accessibility standards for information technology.  As a result, the standards applicable to telecommunications products, including interconnected VoIP services, may be subject to change in the near future.  Newly covered VoIP providers may want to draw this to the attention of the FCC, at least on the question of compliance deadlines.

Steptoe & Johnson Webcast:  "Navigating International Encryption Regulations"

Join Steptoe partners Tom Barba, Maury Shenk, and Michael Vatis on July 18, 2007, at noon EDT for a discussion of the important role of encryption in corporate security and the evolving nature of data security threats.  The webcast will cover country-specific encryption export and import licensing rules (including a demonstration of our Country-by-Country Guide to Encryption Regulations), best practices in global deployment, approaches to global licensing, and strategies for dealing with encryption regulations around the world.  There's no charge to participate, but registration is on a first-come, first served basis.

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