[bestbits] Net neutrality in Brazil: the debate continues

[Carolina Rossini]

http://www.internetlab.org.br/en/internetlab-reports/net-neutrality-in-brazil/

February 4, 2016

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Net neutrality in Brazil: the debate continues

On January 27th this year, the Brazilian Ministry of Justice released
the second phase of the online public debate about how the Marco Civil
da Internet’ regulatory decree will be.

In this second phase, citizens are asked to give an opinion on a draft
decree suggested by the Ministry of Justice, drawn from the more than
1,200 comments made during the first phase. The debate keep addressing
how the Marco Civil’ general rules and obligations about net
neutrality, privacy and data retention should be detailed and put into
practice.

InternetLab produced a report about the this first phase. Our idea was
to disclose what was at stake and what regulatory alternatives were
being proposed by different participants on the online platform. Based
on this first phase report we could analyze what were the choices made
by the Ministry of Justice on its draft decree provided to the second
phase and continue to reveal the controversies and conflicts of
positions. The first issue we will address is network neutrality.

Homepage of the Marco Civil’ regulatory decree online debate platform



Network neutrality: exceptions, enforcement and zero rating

The approval of the Marco Civil da Internet’ net neutrality rule was
seen by many observators as a major step regarding internet rights in
Brazil. However, the debate about the application and enforcement of
this rule was controversial during the first phase of the online
debate about the regulatory decree, especially on how to define the
exceptions to the rule, how to monitor compliance and whether or not
zero rating plans are forbidden by the law. The controversy became
clear between participants representing telecommunication companies
and civil society organizations – scholars and other actors
participated in a less confrontational way.



The two exceptions to net neutrality

During the first phase of the online debate we reported a conflict of
arguments regarding this matter. On the one hand, telecommunications
companies and their representatives advocated for freedom in network
management, on the other hand, citizens, civil society organizations
and some academics have called for stricter rules.

The two cases of exception to network neutrality, that is, situations
in which it is permitted to treat differently data packets that travel
over the internet, are already listed in the Marco Civil (article 9,
paragraph 1): (i) technical requirements for adequate provision of
services and applications and (ii) prioritization of emergency
services. The decree that is being discussed have the task to explain
and define such exceptions, written in broad terms.

First exception: technical requirements essential for the proper
delivery of services and applications

The first exception address an everyday necessity: to perform certain
level of traffic management to ensure network normal operation. This
management enables, for example, that the internet infraestructure
companies provide a minimum connectivity to their customers in cases
of network congestion or even curb security problems as “denial of
service attacks (DoS)” when there is an intentional overload in
traffic with some purpose.

While the telecommunications industry defended the adoption of
principles that could guide the enforcement, organized civil society
have called for the decree to bring one “exhaustive list” of permitted
behavior, that is, it expressly authorize what would be allowed as
“technical requirements”. The draft placed under discussion by the
Ministry of Justice is a mix of both – it exhaustively sets out
situations in which the exception exists, but in generic terms.

This criticism of the generality of the hypothesis of “technical
requirements” should not be unanimous, but has already made public. In
arecent debate at Campus Party 2016 Veridiana Alimonti, from the
Collective Intervozes, argued that the possibility of exception in
case of “treatment of essential issues for the proper enjoyment of
applications, in view of the user experience quality assurance” of the
draft would be too open and generic, making room for violation of net
neutrality – a position that has been endorsed by participants in this
second phase.

Second exception: prioritizing emergency services

The second hypothesis of network neutrality exception was not a huge
subject of controversy in the online platform during the first phase.
However, participants highlighted some guidelines that should be
followed by regulations like a better explanation on what would be an
emergency service that allowed traffic management.

The draft decree addresses the issue and sets out the situations in
which a communication service is considered “emergency”: “notices to
providers of emergency services, as provided for the National
Telecommunications Agency regulations; or communications necessary to
inform the population on disaster risk situations of emergency or
state of public calamity“.



How should be the net neutrality rule enforcement?

The enforcement of network neutrality rule generated great debate in
the first phase of consultation. The controversy revolved around the
centrality of the National Telecommunications Agency (ANATEL). While
the telecommunications companies and some citizens defended the
prevalence of ANATEL as the competent agency for enforcing the net
neutrality rule, civil society organizations have suggested the
construction of a “multi-institutional” system that encompass the
agency, but also count on the participation of the Board of Economic
Defense (CADE, which deals with competition issues), the National
Consumer Office at the Ministry of Justice (SENACON) and Internet
Steering Committee in Brazil, CGI.br. The argument was that the legal
and administrative powers of ANATEL would not be enough to give out
the function of monitoring the neutrality from the point of view of
collective rights.

The draft of the Ministry of Justice rejected this suggestion and left
the enforcement under the responsibility of ANATEL, but guarded to
CGI.br the function of giving enforcement guidelines, especially
because the Committee have been cited in the Marco Civil as a
necessary participant in this process. The draft decree’Article 7,
section I, also establ compliance with the rules of ANATEL as a
requirement for discrimination due to the prioritization of emergency
services.

At the same time, Articles 16 and 17 of draft decree make clear the
space for performance of SENACON and CADE, within their respective
scopes of activity. However the role of these bodies is not clear
regarding net neutrality enforcement.



Zero rating plans

Despite the technical complexity of the subject, zero rating plans
caused controversy in the first phase: the subject was the most
discussed by the participants. One factor is the potential influence
of this type of plan in the competitive context, the development of
Internet-related businesses and in the very way the network works and
is managed. This topic has divided opinions.

The debate revolved around two strategies to regulate free access to
applications. One option, suggested by groups linked to
telecommunications companies, pointed to a subsequent assessment of
each type of plan, i.e., damage to competition and the consumer would
be further processed by CADE or the judiciary. The argument would be
that the regulation should not restrict the economic freedom of the
companies to offer plans to its customers in the commercial context.
According to these participants, differentiation does not happen
within the data packet traffic, but in the commercial sphere.

The second position, supported by academic and civil society
organizations, argued that this type of plan should be prohibited by
the decree, since it is a violation of network neutrality. These
participants argued that plans like these needed to be addressed
immediately and a priori because they were already being offered in
the market and a breach for a future disfigure of the Marco Civil’
network neutrality rule.

Despite the intense debate, the decree does not specifically address
zero rating plans. If the draft is approved, the final decision
regarding whether or not the practice is prohibited will be taken by
the Judiciary or by the CADE board (in case of questions about
anti-competitive conduct).

It can be argued that the draft decree text, by better defining the
hypothesis of exception to network neutrality (Articles 5 and 7) and
by referring to the preservation the unique and public internet
(single paragraph, Article 4 and Article 8), points to the beforehand
prohibition of zero rating plans. In this same line, by the way, it
highlights the emphasis given in Article 5 of the decree to article 9,
item IV  of the Marco Civil, which deals with the prohibition of
discriminatory and anti-competitive business practices.

Article 8 of the decree, however, which concerns agreements between
connection and application providers, only prohibits agreements
entailing the discriminatory prioritization of data packets. In this
sense, there could be room for the argument – already presented in the
first phase of the consultation – that the ban would be only regarding
discrimination related to data traffic, and not discrimination of the
package price. Thus, for the defenders of this position, zero rating
plans would not, in principle, violate the network neutrality rule.

By Francisco Brito Cruz and Jonas Coelho Marchezan

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Carolina Rossini
Vice President, International Policy
Public Knowledge
http://www.publicknowledge.org/
+ 1 6176979389 | skype: carolrossini | @carolinarossini


-- 

Carolina Rossini
Vice President, International Policy
Public Knowledge
http://www.publicknowledge.org/
+ 1 6176979389 | skype: carolrossini | @carolinarossini