Lawyer Speaks of the Main Issues Related to Communications Law21/09/2017
The lawyer Ericson M. Scorsim, from the law firm Meister Scorsim Advocacia, is a consultant in Public Law and an expert on Communications Law, and gave this interview in which he spoke of the main issues related to this subject.
He has a PhD in Law from the University of São Paulo and wrote the book “Communications Law: Telecommunication, Internet, Broadcast Media, and Pay TV”.
Here is the entire interview.
Which laws are part of Communications Law, and what are the challenges in the interpretation of these laws for telecommunications, Internet, and broadcast media companies and the respective users of these communication services?
Ericson M. Scorsim – Communications Law is made up by the Internet Regulatory Framework1, the General Telecommunications Act2, the Private Broadcast TV and Radio Act3, the Public Broadcasting Act4, the Pay TV Act5, and other laws.
In the e-book Communications Law, available for free online download, I explain in detail the main regulatory issues related to the legislation on Communications Law.
Note that the Brazilian Constitution of 1988 has a specific chapter on Social Communication and a chapter related to fundamental individual and collective rights, requiring the interpretation of the laws on communication services, according to the Federal Constitution.
Communications Law has impact on thousands of companies and millions of users of services such as landline and mobile phones, Internet access, Internet applications, broadcast media, and Pay TV. The challenges in the interpretation of the laws from the communications sector, under a systemic view of Communications Law, are related to the use of specific technical terms and the regulatory logic used by the legislator.
In other words, each specific law adopts its own classifications, so their interpretation must consider the relevant distinctions between the respective telecommunications services, Internet access, broadcast media, and Pay TV. In a first moment, there is no application of general laws over these specific sectoral laws, except if the sectoral law allows for the application of the general law.
How do the Brazilian laws on Communications compare to the ones in other countries?
Ericson M. Scorsim – An example of a modern, current Brazilian law is the Internet Regulatory Framework6, which is a reference for other countries. This law deals with Internet access services and Internet applications, which have different legal regimes.
There is also the Pay TV Act, which adopted a new regulatory model for this economic sector.7 The Pay TV Act deals with conditioned access audiovisual communication services, regulating the economic activities of Pay TV production, programming, packaging, and distribution.
The 1997 General Telecommunications Act created the regulatory agency for this sector – Anatel, and established the regime for provision of telecommunications services and the rights and duties of the companies and their respective users.8
Finally, there is the Private Broadcast Media Act. This law, 4117/1962, is prior to the enactment of the 1988 Constitution but the Brazilian Supreme Court has ruled in favor of its reception by the Constitution.
Which sector needs to have its laws revised or updated?
Ericson M. Scorsim – Some claim that the General Telecommunications Act needs to be changed to regulate landline telephone services through administrative authorization, replacing the traditional model of a public utility concession.
This proposed change to the General Telecommunications Act is the scope of legislative bill number 3453 by Representative Daniel Vilela, and would solve the problem of the company OI, a landline telephone concessionaire that has filed for reorganization.
Bill 3453 aims to alter the General Telecommunications Act to allow Anatel to change the licensing regime of telecommunication services from concession to authorization. This replacement of the concession for authorization may be in all or part of the licensed area. Such replacement by Anatel would also be conditioned to proof of fulfillment of the goals to universalize switched landline telephone services.
The bill also includes changing the concession agreement for switched telephone services to a deed of authorization.
The bill to change the General Telecommunications Act provides that the conceding authority will determine the economic value associated with the replacement of the licensing regime for landline telephone services. This economic value will serve as a parameter for investments in the infrastructure of high-capacity data communication networks. The bill also comprehends reversible assets, defined as the assets essential to the provision of switched landline telephone services.
Regarding the reversion of the assets affected by landline telephone concessions, the challenge is to reconcile the need for intense infrastructure investments in telecommunications networks. If there is the reversion of the assets tied to the landline concession to the Federal Government at the end of the concession agreement, which will be in 2025, some argue that this will result in the uncertainty of new investments in the innovation of the infrastructure of telecommunications networks. Thus, it is better to have a more flexible regime for asset reversion, allowing for their economic value to be invested in broadband Internet network infrastructure.
On the other hand, some believe that anticipating this change to the regulatory model of landline telephone services before the end of the concession agreement represents a breach of legal security, and of the landline telephone services concession contract itself. They argue that any changes to the regulatory framework of the telecommunications sector should only be valid after the current concession contracts end.
This bill that aims to change the General Telecommunications Act intends to attribute to Anatel explicit powers to decide on the licensing of telecommunication services, changing it from concession to authorization.
Note that the authorization regime for landline telephone services is nothing new, as it is a provision of the General Telecommunications Act. The new fact is attributing explicit powers to Anatel to decide on the replacement of the legal regime that applies to landline telephone services. The administrative authorization regime favors investment flexibility by the telecommunications company.
In addition to this aspect related to landline telephone services and the proposed changes to the General Telecommunications Act, another noteworthy issue is the regulation of over-the-top (OTT) services, such as Netflix, Facebook, WhatsApp, Youtube, etc. The services based on OTT Internet applications are classified as telecommunications networks added-value services under the General Telecommunications Act. These OTT services have guaranteed access to the infrastructure of telecommunications networks, at non-discriminatory prices. OTT services are also subject to the rules and principles of the Internet Regulatory Framework, as these are Internet application services.
There is a regulatory asymmetry between traditional telecommunication services (landline and personal mobile telephone services) and OTT services such as Netflix, WhatsApp, Youtube and others.
It does not make sense to equate two different types of services (telecom and OTT), given their distinct nature.
Some defend the equivalence of market competition conditions, equating the rules between telecommunications companies and OTT companies, given the tax burden upon them. This is a tax and competition law matter to be resolved by Government, and is not related to the regulatory issue.
What are the case law trends in Communications Law, especially in the higher courts (Brazil’s Supreme Court and Superior Court of Justice)?
Ericson M. Scorsim – I will be launching the e-book “Communications Law Themes in the Case Law of the Brazilian Supreme Court” soon, for free online download. In this e-book I will present the main Brazilian Supreme Court Trials on telecommunications, Internet, Broadcast Media and Pay TV laws, mainly related to the constitutionality of these laws.
In sum, the Brazilian Supreme Court has tried several cases related to Communications Law. One such trial was the case on the constitutionality of the Pay TV Act, still pending a final decision by the Supreme Court. The reporting Justice Fux has already voted for the constitutionality of the law, except for one sole article of that law, which deals with publicity procured by agencies abroad.
In another case, the Supreme Court ruled for the constitutionality of the decree that created the Digital TV and obliged broadcast media companies to adopt digital technology in the transmission of television programs.
The Brazilian Supreme Court also has case law related to the unconstitutionality of state laws that encroached the Federal Government’s exclusive jurisdiction to legislate on telecommunication services.
Another interesting case is the motion for writ of mandamus filed by the former President of Empresa Brasil de Comunicação (the Brazilian Communication Company, in charge of broadcasting the TV Brasil channel) against his removal from office by the acting President of the Republic.
An injunction was granted by the reporting Justice Dias Toffoli in that case (MS 34205) to stay the effects of the removal from office of the President of EBC by the acting President of the Republic, grounded on the argument that Empresa Brasil de Comunicação is independent from the government as per the Public Broadcasting Act, which is Law 11,652/2008.
At the Superior Court of Justice, Special Appeal Resp No. 1.525.174-RS, reported by Justice Luis Felipe Salomão, is a trial on repetitive appeals related to moral damages due to changes in landline telephone services plans/limits without request by the user, and the statute of limitations thereon. When choosing the theme to represent this controversy, the Superior Court of Justice opted for damages related to landline telephone services, excluding services by Internet access providers.
Also pending trial before the Superior Court of Justice is the Motion of Jurisdictional Conflict No. 138.405/DF, on the internal jurisdiction of the Court: whether the Private Law Section or the Public Law Section should try the appeals related to moral damages due to changes in landline telephone services plans/limits without request by the user, and the statute of limitations thereon.
The higher court precedents on Communications Law serve as guidance to the other Courts and judges, and to the telecommunications regulatory agency on the interpretation of the Constitution and the laws. Thus the relevance of examining the case law.
The constitutionality of certain provisions of the recently enacted Internet Regulatory Framework has been questioned before the Brazilian Supreme Court. In your opinion, what are the main controversies of the Internet Regulatory Framework, if any, and its impact to companies?
Ericson M. Scorsim – The main issue is the court-ordered blockage of Internet applications. This theme resulted from a court order that suspended the communications application WhatsApp in all of Brazil, affecting the right of communication of millions of users of that application.
This court ordered blockage of WhatsApp not only affected significantly the right to communication of millions of Brazilians, but it also affected the right of the company that provides this Internet application.
This suspension of the WhatsApp application also had significant impact on the companies that sell products and services through it on the Internet.
The Internet Regulatory Framework allows for the suspension of Internet applications in the case of operations for the collection, storage, safekeeping, and treatment of records, personal data or communications, in violation of the Brazilian laws that protect the privacy of the personal data of users and the confidentiality of private communications.
However, the Internet Regulatory Framework does not allow the courts to block Internet applications grounded on the noncompliance with a court order.
Anyhow, there is a motion of unconstitutionality on trial before the Brazilian Supreme Court, ADI Nol 5527, reported by Justice Rosa Weber, without any ruling on the merit yet, but that will allow that Higher Court to give a better constitutional interpretation on the Internet Regulatory Framework, especially under the light of the essential right to free communication.
The Brazilian Supreme Court has a key role in defining the limits for interpretation of the Internet Regulatory Framework under the Brazilian Constitution, to serve as guidance for the other Courts and judges.
- Law 12,965/15
- Law 9,472/97
- .Law 4,117/62
- Law 11,652/08
- Law 12,485/11
- Law 12,965/15
- Law 12,485/11
- Law 9,472/97