In April 2014, Web luminaries Sir Tim Berners-Lee and Vint Cerf joined over 850 academics, government officials and activists in São Paulo to attend NETmundial, Brazil’s unique Internet forum. At the opening ceremony, Brazilian President Dilma Rousseff signed into law the Marco Civil da Internet (Civil Rights Framework for the Internet), which established a groundbreaking Internet bill of rights for Latin America’s largest digital economy. While the event appeared perfectly scripted, the bill’s journey to becoming law was so rocky that its future was still uncertain only hours before the ceremony.
The Marco Civil bill languished in Brazil’s Congress due to a heated national debate over “net neutrality”—the principle of nondiscriminatory treatment of all online content, regardless of origin or end user. It’s a debate, in fact, that stretches far beyond Brazil’s border—and, in the view of some observers, is central to the future of the global Internet. But it was the political controversy fueled by the revelations of Washington’s electronic spying on Brazilian political leaders that created a renewed sense of urgency for the Marco Civil.
Brazil was not breaking new ground with the net neutrality provisions in the bill. Chile was the first country in the world to pass net neutrality legislation in 2010, and Colombia incorporated provisions into its public services law in 2011. The Netherlands adopted similar legislation in 2012. In the U.S., the Federal Communications Commission voted in February to classify broadband as a public utility for the purposes of preventing discriminatory treatment of traffic or services.
Even with the Marco Civil, the battle over digital rights and access in Brazil is not over. The regulations for the law’s net neutrality and other provisions have yet to be implemented, and how they are crafted will have a significant impact on innovation and the digital economy.
Brazil’s Digital Landscape
Brazilians have a voracious appetite for all things digital. Ranking fifth worldwide in total Internet users, Brazil has a well-developed e-commerce industry and tops the charts in social media usage. It is second only to the U.S. in Facebook, Twitter and YouTube users, despite having an Internet penetration rate of just 53 percent (Internet penetration in the U.S. is around 85 percent).
Brazil has also been a pioneer in multistakeholder Internet governance. In 1995, Brazil’s Ministry of Communications created the Comitê Gestor da Internet no Brasil (Internet Steering Committee—CGI.br), which coordinates and integrates Internet service across the country in consultation with a broad group of stakeholders, from government to academia to industry. The existence of a digitally savvy population and a civil society with a history of engagement in Internet governance helped the concept of an Internet bill of rights gain traction.
In 2009, efforts to regulate and legislate the Internet in Brazil were chaotic. To guide its work, CGI.br developed “principles for the governance and use of the Internet” in Brazil, which addressed freedom of expression, privacy, universal access, innovation, net neutrality and security, and interoperability. Meanwhile, Congress was considering poorly drafted bills to address cybercrime, which could criminalize routine activity on the Internet. And Internet companies had a complicated relationship with Brazil’s judiciary due to the legal uncertainty regarding their rights and responsibilities vis-à-vis user-generated content.
To head off the threat of Congress criminalizing online activity as the default for Internet protection, the Brazilian Ministry of Justice and the Getulio Vargas Foundation’s Center for Technology and Society launched an initiative in October 2009 to create a regulatory framework for the rights and responsibilities that should apply to Internet providers, users and companies through an open and collaborative online consultation.
The Marco Civil was the final product of this novel approach in multistakeholder policy development. It created the first-of-its-kind civil framework to promote innovation and competitiveness and establish a set of guarantees, rights and responsibilities for Internet use in Brazil. Provisions on freedom of expression, net neutrality, data protection, intermediary liability, and promotion of Internet access were central to the bill, which was designed to cover the entire Internet ecosystem—from service and application providers to users.
Cyber-Spying Raises the Stakes
In August 2011, the landmark bill was sent to Congress, where competing interests stalled its progress for nearly two years. While the debate over the net neutrality provisions prevented the bill from moving forward in the legislature, it was the discovery that the U.S. National Security Agency was monitoring the conversations of Rousseff and her top aides, as well as snooping electronically on the Brazilian state oil company, Petrobras, that reignited interest in establishing the guarantees and protections enshrined in the Marco Civil. The revelations—part of the huge trove of classified material leaked by former CIA contractor Edward Snowden in the summer of 2013—were a political bombshell in Brazil. In response, Rousseff moved to introduce new provisions in the bill, including stronger privacy language.
The stringent privacy protections written into the bill, however, could inhibit Brazil from taking full advantage of the benefits of the Internet. For example, the requirement to obtain express consent before collecting personal information could hamper the provision of innovative services as well as interfere with the use of large-scale data analytics for innovation in fields such as medicine, education and transportation.
Brazil’s pursuit of digital privacy protections did not stop at the Marco Civil. In a scathing speech at the 2013 UN General Assembly, Rousseff proposed a multilateral framework for the governance and use of the Internet, leading to the following year’s NETmundial meeting. Brazil worked with Germany to propose a UN resolution on the right to privacy in the digital age. Subsequently, UN Resolution 68/167, adopted by consensus in December 2013, raised concern over the negative impact that surveillance may have on human rights and called for the protection of the right to privacy in digital communication.
Providers Don’t Lose Out
Nevertheless, just as the Marco Civil establishes rights for Internet users through net neutrality and privacy provisions, it also creates critical protections for Internet companies and intermediaries—ranging from Internet access and service providers (ISPs), data processing and web hosting providers, and Internet search engines to e-commerce and social media platforms. The law explicitly protects intermediaries from being held liable for user-generated content, except when the companies fail to comply with court orders requiring the removal of content. Internet companies operating in Brazil have been plagued by content takedown requests for years; while many appeals have legal grounds, many more come from public figures wanting to suppress criticism— raising freedom of speech concerns. The Marco Civil gives much-needed legal certainty to intermediaries operating in Brazil.
Rising domestic concerns over encroachments on privacy led the Rousseff administration to push the envelope even further, requiring Brazilians’ data to be stored in servers within Brazil’s national territory. It was a poorly thought-out effort to shield citizens from surveillance activities—and it created a new political storm. While similar measures have since been enacted in Russia (Vietnam and Indonesia have considered narrower measures), at the time, Brazil would have been the first country to mandate in-country data storage.
Opponents claimed the data localization proposal would “break the Internet.” If other countries followed suit, they argued, it would lead to the creation of myriad “national” Internets, cutting off crossborder data flows and stifling innovation. Initially, the proposals left unclear the type of data to be targeted. This created anxiety among a broad group of industries, from manufacturing to entertainment, who were concerned that their ability to operate would be constrained by restrictions of cross-border data flows. Some also felt the price of building data centers in Brazil would make doing business there more expensive, with many of the costs being passed on to Brazilian consumers. Others argued that establishing a physical location for data could increase vulnerability to cyber-sabotage. A combination of global uproar and powerful domestic opposition ultimately led to the provision’s removal from the Marco Civil in late March 2014, clearing a major hurdle for the bill.
But even as data localization requirements were removed, another controversial provision was added. Companies offering Internet services used by Brazil-ians—regardless of size or location—would be subject to Brazilian law. Depending on how this provision is ultimately implemented, the extraterritorial reach of Brazilian law could discourage new, innovative companies and startups from offering their services to Brazilians.
What’s Next for the Marco Civil and Brazil’s Digital Economy?
The development of the Marco Civil and some of the concepts addressed in it are a significant advancement in Internet regulation. But until the implementing regulations are announced, the impact of the Marco Civil on innovation and growth of the digital economy in Brazil will be unclear. The government is applying the same multistakeholder approach it took to create the law to the drafting of the implementing regulations. In collaboration with all sectors of society, the government must ensure that implementation of this global model bill of Internet rights fosters the growth of the digital economy, ensures the continued availability of innovative services, and promotes innovation in Brazil.
We won’t have to wait long to see the results. The government hopes to have the implementing provisions in place by November 2015, when Brazil is due to host the 10th annual Internet Governance Forum, the UN’s global multistakeholder forum on Internet governance issues.
The November conference represents another opportunity for Brazil to display its growing leadership in Internet governance issues. Brazil’s support for democratic and multistakeholder approaches to Internet regulation and governance is critically important, and is worth emulating elsewhere. Indeed, in October 2014, Italy followed Brazil’s lead and launched a public consultation on a draft declaration of rights on the Internet.
Looking ahead, the debate over how to apply the Marco Civil will be as crucial to the growth of Brazil’s digital economy as the debate over the original bill.