IP Discrimination: Western Hemisphere Split on Geoblocking… Sorta

March 2, 2018 the European Union (EU) and the U.S. Court of Appeals for the District of Columbia deviated with respect to their respective geoblocking policy.

Geoblocking is a method companies and websites use to ensure that only users in a specific geographic location are able to access a certain site or service. This is done through checking users’ device’s unique internet protocol (IP) address. Moreover, companies and online retailers apply barriers and impose restrictions to consumers on the basis of their nationality or place of residence.

For example, British Broadcasting Corporation (BBC) is a public service broadcaster in the UK run by its government. It is free to all British citizens since it is funded by taxpayers’. BBC iPlayer, BBC’s online adaptation where users can watch live and on-demand movies and shows, uses geoblocking and through checking a user’s IP address BBC iPlayer disallows outsiders trying to “enter.” Also, than just denying consumers access to website altogether, online sellers can re-route a user to the local store within user’s location with different prices.

Geoblocking and other geographically-based restrictions undermine online shopping and cross-border sales by limited the possibility for consumers and businesses to benefit from the advantages of online commerce. In response, the EU Commission passed Regulation 2018/302, which will end discriminatory, geographically-based restrictions starting December 3, 2018, but not exclusively.

After two years of enforcement, the Commission will evaluate the impact of the regulation on the internal market. Streaming services, including Netflix and Amazon Prime for example, are exempt from EU regulation. It also exempts digital copyrighted content, including e-books and computer games.

With these exemptions, the EU’s efforts for a single market—across the 28 Member States of the bloc—are seen more aspirational and fail to embrace a meaningful reform of digital copyright rules.

On the other side of the Western Hemisphere, on the very same day, the U.S. Court of Appeals for the District of Columbia, through Spanski Ent., Inc. v. Telewizja Polska, S.A., reinforced the practice of geoblocking.

Telewizja Polska (TVP), a Polish state-owned television station, granted an exclusive license to Spanski Enterprises, Inc. (SEI) for the public performance of TVP’s content in North and South America. The problem arose when TVP’s website was allowing United States users to access the exclusive content licensed to SEI. Consequently, TVP agreed to geoblock U.S. users. However, TVP’s geoblocking efforts were unsuccessful and SEI’s copyright infringement claim prevailed.

While Spanski involves stylized facts and issues, including the extraterritorial application of the Copyright Act, this court decision paired with the EU anti-geoblocking regulation has left geoblocking policy unclear for internet actors and litigating transborder copyright infringements in the coming years.

However, when looking at the Commission’s geoblocking regulation and its gaping exemptions, specifically the streaming services exemption, Regulation 2018/302 does not go against the holding in Spanski, which concerned copyright issues in the streaming services. Furthermore, consumers home and abroad looking for reform of digital copyright rules are left with no material improvement.