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Home »Subjects»Technology»Government pushes through new data retention laws

Government pushes through new data retention laws

Posted on27/03/201527/03/2015AuthorMichael Swinson

On 26 March 2015 the Government’s controversial new telecommunications data retention laws were passed by Parliament. These laws, enacted through the Telecommunications (Interception and Access) Amendment (Data Retention) Act 2015 (Cth), will now come into effect 6 months from the date that the Act receives royal assent.

It is perhaps somewhat unfair to describe this as a Government initiative, given that the new laws have broadly received bipartisan support from the Labor Party (though they have been fiercely opposed by some of the minor parties and independents). While Labor expressed some concerns about the initial form of the Bill introduced to Parliament in October 2014, once the Government accepted the changes recommended earlier this year by the Parliamentary Joint Committee on Intelligence and Security that was appointed to review the Bill, the passage of this legislation was never really in doubt.

However, this has not prevented the use of some very emotive language, both in Parliament and more broadly in the public domain, to debate the new laws, with positions varying from one extreme (that the legislation is essential to protect the Australian “way of life”) to the other (that the legislation will lead to tyranny by facilitating mass surveillance). The flames of this debate have been fanned by media organizations concerned about the prospect that data retained to comply with the new laws may be used to identify their confidential sources.

So what is the truth of the matter? Well, the core features of the Act that has been passed are basically the same as those of the original Bill, which we described in an earlier IP Whiteboard post (see here) so, at a high level, it will still be the case that telecommunications will need to retain a defined set of telecommunications data or “metadata” for a period of 2 years. However, there have been some important changes as a result of the Government adopting the Joint Committee’s recommendations. The most important changes are as follows:

Defining the data set – One of the major concerns with the original Bill was that it did not define the specific data that telecommunications providers would be obliged to retain. Instead, it described a series of general categories of data that might need to be retained and gave the Minister for Communications power to make regulations in order to define the specific data in those categories that relevant service providers would actually need to keep. While the Government claimed that this mechanism was required to ensure that the scheme could react to changes in technology, there was strong public concern that it would enable the Government to extend the reach of the scheme without appropriate scrutiny by Parliament. Ultimately the Joint Committee agreed, saying that the relevant data set should be defined in the legislation itself rather than through a regulation making power and this is what the new Act does, setting out a table that describes all of the data that must be retained. In addition, in response to other concerns raised before the Joint Committee, the explanatory memorandum for the Act has been updated to clarify that carve outs built into the Act mean that providers will not need to retain information about user web browsing histories or user passwords or user IDs.

Interestingly, the Act preserves a right for the Minister to add new categories of data by making a declaration to that effect. However, this is intended to be an emergency measure only, and Ministerial declaration will cease to apply once there have been 40 sitting days of Parliament to discuss the matter. Clearly, it may be challenging for telecommunications providers to comply with any such emergency declaration, as their systems may not be designed or configured in order to capture and retain the additional data. Showing some empathy for this concern, the Government has indicated in a press release that any Ministerial declarations “may take effect at a future date, to provide appropriate notice to providers of an amended obligation”. However, the concept of giving advance notice for industry appears to be in conflict with the notion that declarations will only be made in emergency situations where there is insufficient time for proper Parliamentary debate. Given this apparent contradiction, it is unclear to us how this power will ever be exercised in practice.

Controlling access and enhancing security – One effect of the new data retention regime is that it will require telecommunications providers to retain large repositories of rich and detailed data that may potentially act as “honeypots” that attract fraudsters and others who may wish to use that data for criminal purposes. The Act seeks to address concerns in this regard by requiring that telecommunications providers must protect the confidentiality of their retained data by use of encryption and other steps to protect the data against unauthorized interference or access. The Act also makes other changes to help prevent inappropriate use of retained data, including by: (1) applying a stricter standard that must be satisfied before a law enforcement officer may issue an authorization to access retained data – where currently the officer simply needs to “have regard” to whether any potential interference with privacy can be justified, they will in the future need to “be satisfied on reasonable grounds” that any such interference is not only justifiable but also proportionate; and (2) clarifying that information kept solely to comply with the new data retention scheme will not need to be disclosed in connection with a civil proceeding – for example, this means that the retained data cannot be accessed under a subpoena by civil litigants (easing the concerns of some that the scheme would be a boon for litigious copyright owners hoping to identify and catch out alleged copyright pirates).

While the original Bill reduced the number of agencies authorized to access telecommunications data, the Act has expanded this list to also cover the ACCC and ASIC, as those organizations also have an important role to play in investigating and taking action in response to white collar crime.

Additional protection for journalists – As mentioned above, media organizations have expressed strong reservations that any additional retained metadata pursuant to the new laws may be misused to identify the confidential sources used by journalists and, therefore, could have a chilling effect on journalistic freedom. This may go some way to explaining the very negative media coverage of the original Bill, despite the Government’s protestations that it was simply designed to regulate the retention and use of data that, in many cases, is already being kept by many telecommunications providers and can already be accessed by law enforcement agencies. Ultimately, the Government conceded to media pressure and has introduced in the Act a special requirement to obtain a warrant to access telecommunications data relating to a journalist where the purpose of accessing the data is to identify a source (in other cases equivalent data can be accessed under an authorization given by an appropriate senior officer within a law enforcement agency, without needing to obtain a warrant).

Government contribution to funding – One key concern for industry has always been about how the costs of the data retention scheme will be funded. Estimates of the likely implementation costs have varied widely, largely because the details of the scheme have been unclear until recently. However, the latest estimates from Government indicate that the costs may exceed $300 million. The Government has repeatedly indicated that it will “make a reasonable contribution to the upfront capital expenditure required to implement data retention obligations” but has declined to provide any details about the amount of the Government’s contribution or how it will be allocated amongst industry participants. In addition, the Government’s statements seem to indicate any financial assistance will be provided on a once-off basis, which may help current providers to retro-fit data retention capabilities to their existing networks, but will not necessarily help to cover the costs of building these capabilities into future networks or of operating and maintaining data retention facilities on an ongoing basis. The Act provides a mechanism for the Government to provide financial assistance to assist telecommunications providers to comply with their data retention obligations, but otherwise does not shed any further light on the matter. Accordingly, for industry this remains a significant grey area, and it is too early to draw any conclusions about the likely financial implications of the new laws for different industry participants.

Finally, the Government has held back one very major piece of the jigsaw puzzle. Following its review of the original Bill, the Joint Committee recommended that there be a mandatory data breach notification scheme, which would not only let people know when their retained telecommunications data has been accessed for an unauthorized purpose but would also apply more broadly to other types of personal information as well. Some form of broader mandatory data breach notification scheme has been mooted for some time, and legislation that would have incorporated such a scheme into the Privacy Act 1988 (Cth) was introduced by the former Labor Government before the last election. That legislation has languished ever since, but seems likely to be revived in some form in the near future, as the current Government has committed to implementing a breach notification scheme before the end of 2015. This will have an impact far beyond the telecommunications industry and will affect any organization that collects and stores personal information. So, all in all, 2015 is shaping up to be a very significant year for those with an interest in data protection!

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