European Lawmakers Upset ISPs, Game Makers

Brussels proposes changes to copyright protection legislation, delays planned tax breaks for British game developers.
The European Commission has already rankled at least two European tech industry groups -- and the week's not even halfway over.

First, the Internet service providers (ISPs). Brussels has been slammed over its plans to change copyright enforcement law and alter IPRED, the 2004 directive on how intellectual property rights are enforced. That's a problem for ISPs as it means they will be obliged to spend more time and money filtering content.

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In essence, the Commission's aim is to curb illegal downloading of paid-for content, arguing that ISPs need to do more to block such illegal activity. The ISP industry says that the revisions as outlined are overly bureaucratic and too heavily weighted in favor of copyright holders -- e.g., big Hollywood production companies and record labels.

Objectors to the plan, led by EuroISPA, which claims to speak for 1,800 European ISPs, counter that proposed amendments to the directive could have "a chilling effect" on innovation, consumers' confidence in digital products, freedom of communications and Internet openness by turning ISPs into content police and alienating their customers. The organization said, "Internet intermediaries must under no circumstances be tasked with a monitoring obligation of users' communications and play a civil enforcement role outside any judicial framework."

In another move that's furrowed many a brow, Brussels has slammed the brakes on the U.K.'s ambitions to create tax breaks to help foster that country's game industry. In his spring 2012 budget, British Chancellor George Osborne promised to limit tax on the costs of video game creation, offering a 25% relief on the total costs a company incurs bringing a new title to market.

The British gaming industry has long complained of struggling in the face of "unfair" overseas competition, and the plan was greeted as an encouraging step in the right direction. In fact, as recently as last month, leaders of British gaming trade association Tiga were optimistic about the positive effect the tax break would bring the sector.

But Brussels now says it needs more time to look at the plan. Presumably, lawmakers are concerned that favoring British game developers too much could distort the market: "The market for developing video games is dynamic and commercially promising. It is not clear whether the taxpayer should be subsidizing this activity."

This doesn't necessarily mean the tax breaks are dead in the water. But U.K. game firms might not have beaten the Big Boss on this level quite yet.

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Brian T. Horowitz, Contributing Reporter
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