Net neutrality lives... in Europe, anyway: Top court supports open internet rules, snubs telcos and ISPs

It only took five years

Europe’s top court has decided that the continent’s network neutrality rules will stand, rejecting challenges from the telecoms industry.

In a ruling [PDF] on Tuesday, the Court of Justice of the European Union (CJEU) decided that “the requirements to protect internet users’ rights and to treat traffic in a non-discriminatory manner preclude an internet access provider from favouring certain applications and services.”

Or, in other words, people come before telco business models. And that includes the edge case of “zero tariff” arrangements where data caps don’t apply to specific apps or services that the ISP or telco designates. Picture a broadband provider allowing, say, Netflix streams to not count toward subscribers' monthly download limits, which squeezes Netflix's competitors out of the market. Blocking access to, traffic slowdowns of, and “fast lanes” for specific applications are also out.

The decision was welcomed by consumer-rights groups and internet companies, though ISPs and telcos are disappointed: they feel the net neutrality rules are too restrictive, and prevent them from bringing in new revenue to replace falling income from traditional telephone lines.

The judgment came after a Hungarian court asked for guidance when one of its telcos, Telenor Magyarorszag, offered a zero-tariff option to subscribers. The country’s technology regulator said that approach broke Europe’s net neutrality rules, which were passed back in 2015, and the telco challenged its decision.

It is, to the best of our knowledge, the first time the CJEU has weighed in on the open internet. Interest in the case was made clear by the number of comments from countries’ governments that were submitted to the court for review: Austria, the Czech Republic, Finland, Germany, the Netherlands, Romania, and Slovenia all weighed in.

The court summarized the zero-tariff approach: “The specific feature of those packages is that the data traffic generated by certain specific applications and services does not count towards the consumption of the data volume purchased by customers. In addition, once that volume of data has been used up, those customers may continue to use those specific applications and services without restriction, while measures blocking or slowing down data traffic are applied to the other available applications and services.”

Reasoning

The court said its interpretation of the relevant regulations was that no company had the right to limit people’s right to an open internet and that people exercised those rights “via their internet access service.”

A zero-tariff approach “is liable to limit the exercise of end users’ rights,” it decided, as they “are liable to increase the use of the favoured applications and services and, accordingly, to reduce the use of the other applications and services available.”

It went on: “Furthermore, the greater the number of customers concluding such agreements, the more likely it is that, given its scale, the cumulative effect of those agreements will result in a significant limitation of the exercise of end users’ rights, or even undermine the very essence of those rights.”

It also rejected the idea there should be a measure of the impact of a zero-tariff service to see if it did in fact infringe rights, saying there was nothing in the law that required anyone to “assess whether the general obligation of equal and non-discriminatory treatment of traffic in that provision has been complied with.”

And, just to stick the knife in, it argued that any “measures blocking or slowing down traffic are based not on objectively different technical quality of service requirements for specific categories of traffic, but on commercial considerations, those measures must in themselves be regarded as incompatible with Article 3(3).”

In essence, Europe’s top court decided that money does not come before people’s rights. In the United States, meanwhile, the issue of net neutrality has everything to do with money.

Currently, with a Republican administration that takes a lot of money from Big Cable, net neutrality rules are seen as a terrible thing. Come November, if there is a switch to a Democratic administration, and the balance of money comes instead from Big Internet, no doubt there will be yet another re-evaluation of the rules. ®