Digital Agenda for Europe
A Europe 2020 Initiative

AmCham EU's Response to the European Commission Consultation on Internet Governance

Discussion

Is there a need to move toward one global principle based framework?

 The Internet and the investment that makes it possible are thriving today because it has been governed under a multi-stakeholder model, which creates an environment that allows for rapid growth and innovation without centralised control or global regulation. This multi-stakeholder environment built the highly successful global Internet of today by bringing together engineers and scientists, civil society, business, government, academics, and the general public. It has promoted the Internet in a way that is flexible and allows networking and communications to flourish. As the Internet has matured, new approaches, new venues and new forums have arisen that bring technology and policy experts together to respond to the opportunities and challenges that have been created.

 Technical organisations such as the Internet Engineering Task Force (IETF) and the Internet Architecture Board (IAB) develop consensus-based technical standards to ensure the Internet remains an interoperable platform open to innovation. The multi-stakeholder model also is epitomised by the Internet Corporation for Assigned Names and Numbers (ICANN), which coordinates the assignment of Internet domain names and addresses on a global basis with the participation of a wide range of stakeholders. Additionally, organisations such as the Internet Society (ISOC), and the Regional Internet Registries (RIRs), serve important examples of multi-stakeholder entities in the Internet’s eco-system.

 Through the World Summit on Information Society (WSIS), and its outcome documents, specifically the Tunis Agenda for the Information Society, the United Nations (UN) took steps to embrace the multi-stakeholder model as a new way to address Internet governance issues.  The Tunis Agenda in paragraph 34 noted the working definition of Internet governance as: “the development and application by governments, the private sector and civil society, in their respective roles, of shared principles, norms, rules, decision-making procedures, and programmes that shape the evolution and use of the Internet.”

In 2005 the UN established the Internet Governance Forum (IGF) as a multi-stakeholder forum to discuss existing and emerging Internet governance policy issues. The unique structure of the IGF allows it to shape the Internet policy agenda at the global and national level in a way that national priorities and stakeholders, while avoiding centralised decision-making or a politicised inter-governmental treaty process.

Moreover, the IGF has catalysed national and regional IGF events around the globe, including East Africa, West Africa, Russia, the Ukraine and the Asia-Pacific region.

 The multi-stakeholder process has enabled the Internet’s evolution across the world and it will be crucial for the Internet’s future success. Given the rapid pace of technological change, any framework for Internet governance needs to be guided by fundamental principles for international cooperation. To protect and preserve the economic and social opportunity made possible by Internet investment and innovation, it is absolutely crucial for the Internet governance process to be transparent and open to all stakeholders. Accordingly, multi-stakeholder organisations involved in Internet-related issues have shared common characteristics, such as open stakeholder participation, consensus-based decision making, information sharing, outreach and collaboration.

 Some countries and institutions, however, continue to support a more traditional model of national sovereignty and inter-governmental control over Internet governance. Such an expansion of the traditional government-controlled governance model would undermine the transparent fabric on which the Internet is built, potentially stifling its unprecedented capacity for economic and social development. The fragmentation of the Internet that could result from governance disputes has serious implications for the free flow of information across national borders.

 That said, in considering the viability of a global principle-based framework, we should consider whether: (1) consensus can be found at a relevant level of abstraction; (2) consensus can be found that is flexible enough to embrace the diversity of global stakeholders; and (3) a centralized framework would jeopardize the benefits of decentralization and regulatory restraint that have been an important part of the Internet’s positive impact.

 Are we on the right track towards a system of governance on an equal footing?

 The multi-stakeholder process must continue to evolve so that it is inclusive, participatory and representative of the global Internet community. In particular, expanded involvement by business, government and other stakeholders from emerging economies is critical to the legitimacy and future sustainability of the multi-stakeholder process. This can only be accomplished with a flexible and scalable approach that is supported by consistent engagement and practical solutions for making the process as open and accessible as the Internet itself. As the underlying infrastructure of the Internet continues to be extended to more and more countries, there should be a corresponding expansion of involvementfrom developing countries as they become more involved in the global Internet economy.

 AmCham EU members firmly believe that governments should work in tandem with industry and civil society to keep the web open for all companies and civil society so they can engage in legitimate activity, and to capitalise on the positive correlation between Internet investment and economic growth. There are a number of models being developed to addressing Internet governance issues in fair, collaborative ways. Many of the organisations and forums addressing Internet-related issues and their decision-making processes are already multi-stakeholder, including the Internet Corporation for Assigned Names and Numbers (ICANN), the Internet Governance Forum (IGF) as well as regional IGFs, the Internet Society, IETF, RIRs, etc.

While the IGF, for example, does not negotiate an outcome, it enables those with policy-making power in both the public and private sectors to be part of an open exchange of information. It has also catalysed dozens of national and regional IGF initiatives. The IGF continues to demonstrate why maintaining an open and transparent process that encourages participation from a diverse range of actors, including business, is paramount. The first principle of Internet governance should be to ‘do no harm’. The favourable Internet governance environment has been the prerequisite for continued investment, innovation and development. Internet availability is steadily growing in all regions, with the most significant impact coming in places that prepare the fertile ground for open markets. Given the rapid evolution of technology, it is critical that we set out high-level principles for international cooperation that can adapt with the pace of technology, rather than mandate or encourage detailed new regulations that address the technical issues of today (or yesterday).

 Some have reacted by calling to withdraw inside national Internet borders or diversification of physical infrastructure. Do such calls pose a risk to the 'One Internet' principle?

 N/A

 To what extent are the current debates on Internet governance sufficiently focusing on who controls key physical and logical resources (e.g. where does the majority of the traffic go to, who controls major Internet exchange points, how do key standardisation efforts influence the balance of power among stakeholders?

 Government initiatives to mandate national Internets would fragment the global Internet and negatively impact the cross-border flow of information, freedom of expression and global commerce.

 The avoidance of restrictions on cross-border data flows is particularly important to digital trade. Countries should undertake to permit cross border data flows and external data management, storage, and access (including the ability to use cloud-based technologies) both within a firm and in its operations with customers. These commitments should clearly prohibit the adoption or continuation of requirements for local data storage, the use of local servers, or other local sourcing or local content restrictions that similarly restrict cross-border data flows and limit the growth of digital trade and electronic commerce.

 AmCham EU believes that unnecessary regulation should be avoided. Indeed regulatory requirements can be discriminatory barriers to market access. To minimise regulatory impediments, countries should undertake in their trade commitments to require regulations to be limited to those necessary to achieve specific and legitimate public policy objectives, establish regulations pursuant to transparent procedures allowing comment by all interested parties, and review and eliminate regulations, or forbear from their application, where competitive market forces are present to achieve the regulatory objective.

 All countries thus should avoid unnecessary regulation and allow commercially negotiated arrangements where competition is effective. Internet traffic arrangements, for example, are negotiated in highly competitive markets, in which prices for transit services are continually declining, Internet traffic volumes are continually increasing, and there are many options for Internet service providers (ISPs) and content providers to exchange traffic and reach users quickly and reliably. By encouraging the rapid growth of Internet connectivity throughout the world, these arrangements are a major reason for the phenomenal success of the modern Internet.

 The effectiveness of Internet traffic arrangements results in substantial part from the absence of prescriptive regulation that would lock into place specific technologies and business models and increase cost. Governments and regulators have generally recognised that these arrangements are commercial transactions negotiated in a competitive marketplace and require neither regulation nor detailed oversight to ensure that consumers and other users are properly served. Regulation of these arrangements is unnecessary, because the large number of indirect interconnection alternatives gives all networks strong incentives to reach efficient interconnection arrangements and thus ensures continued end-to-end connectivity. It is to be hoped that all countries will share this assessment and work to preserve today’s unregulated Internet and the very significant user benefits that stem from its resulting dynamism, innovation, and flexibility.

 As it emerged from the World Conference on International Telecommunications (WCIT) convened by the ITU in Dubai in December last year, some countries and operators wish to replace current commercially-negotiated Internet traffic arrangements with a ‘sending network pays’ or similar regulatory model designed to subsidise the build-out of Internet network infrastructure. Although doubtless well intentioned, such regulation would significantly harm rather than assist the future development of the Internet by suppressing Internet traffic flows and investment incentives, and reducing connectivity to countries adopting such regulation. Rather than adopt such misguided measures, countries that claim to require these subsidies to expand their Internet infrastructure should be encouraged to achieve this result by following the path successfully taken by many other countries of adopting the pro-competitive telecom liberalisation and privatisation policies recommended by the World Bank, UNCTAD and other expert observers.

 How can the risk be limited that separate network infrastructures co-exist or can be isolated from one another, thus undermining the One Internet principle?

 At the WCIT in Dubai, it became clear that some countries and institutions continue to support a more traditional model of national sovereignty and inter-governmental control over Internet governance. Such an expansion of traditional government-controlled governance model would undermine the transparent fabric on which the Internet is built, potentially stifling its unprecedented capacity for economic and social development. The fragmentation of the internet that could result from governance disputes has serious implications for the free flow of information across national borders.

 This risk is emerging at a time when the need to protect the free flow of information online has never been greater. It is the key pre-requisite for both the freedom of expression online and free trade, for without the unhindered flow of data, the global Internet-based economy cannot flourish.

 The remarkable success of the Internet has been that it has been primarily commercial decisions based on mutual interest that have driven the connectivity between thousands of different privately owned networks. We strongly encourage global dialogue to address concerns in a way that avoids network fragmentation and focuses on building trust and confidence.

 Do you think that the current multi-stakeholder model has enough legitimacy – both regarding process and stakeholders - given the fundamental impact of the Internet on our societies?

 As highlighted above, the Internet and the investment that makes it possible are thriving today because it has been governed under a multi-stakeholder model, which creates an environment that allows for rapid growth and innovation without centralised control or global regulation. This multi-stakeholder environment built the highly successful global Internet of today by bringing together engineers and scientists, civil society, business, government, academics, and the general public.  It has promoted the Internet in a way that is flexible and allows networking and communications to flourish.

 AmCham EU considers the multi-stakeholder model as the most effective way to address existing and emerging policy issues while preserving the investment and innovation that has made the Internet such an extraordinarily powerful tool for economic and social development. There is general agreement that governance structures should remain dispersed and multi-stakeholder, rather than top-down and controlled by governments. At the same time, as mentioned previously in this paper, the multi-stakeholder process must continue to evolve so that it is inclusive, participatory and representative of the global Internet community. In particular, expanded involvement by business, government and other stakeholders from emerging economies is critical to the legitimacy and future sustainability of the multi-stakeholder process. This can only be accomplished with a flexible and scalable approach that is supported by consistent engagement and practical solutions for making the process as open and accessible as the Internet itself. As the underlying infrastructure of the Internet continues to be extended to more and more countries, there should be a corresponding expansion of involvement from developing countries as they become more involved in the global Internet economy.

 How can capture of the process by vested interests be prevented?

 Consistent participation by all stakeholders helps to ensure that a diversity of interests have meaningful input on decisions.  All stakeholders have a vested interested stake in the continued development of the Internet and should participate in the relevant forums where issues are discussed.

  Where does the model need to be improved?

As already stressed, additional efforts should be made to facilitate further developing country participation and civil society participation in the existing multi-stakeholder organizations.  These groups in particular have been historically under-represented at certain organizations, and their input is incredibly valuable for guiding decisions on how to enhance affordability and adoption of the Internet.

 In your view, is the current framework of international law sufficiently suited to the Internet?

 N/A

 Which possible areas for improvement do you see as the most urgent?

 N/A

 

How do you think that discussions and solutions to these challenges should be designed?

As already stated, the highly successful Internet model of today and the investments that have made it possible have been enabled by a multi-stakeholder approach which created an environment that allows for rapid growth and innovation without centralized control or global regulation. AmCham EU believes that unnecessary regulation should be avoided. Indeed regulatory requirements can be discriminatory barriers to market access. To minimise regulatory impediments, countries should undertake in their trade commitments to require regulations to be limited to those necessary to achieve specific and legitimate public policy objectives, establish regulations pursuant to transparent procedures allowing comment by all interested parties, and review and eliminate regulations, or forbear from their application, where competitive market forces are present to achieve the regulatory objective. All countries thus should avoid unnecessary regulation and allow commercially negotiated arrangements where competition is effective.

 

***

AmCham EU speaks for American companies committed to Europe on trade, investment and competitiveness issues. It aims to ensure a growth-orientated business and investment climate in Europe. AmCham EU facilitates the resolution of transatlantic issues that impact business and plays a role in creating better understanding of EU and US positions on business matters. Aggregate US investment in Europe totalled €1.9 trillion in 2012 and directly supports more than 4.2 million jobs in Europe.

 

***

Interesting
15 users have voted.
Group managers
Cristina MARTINEZ GONZALEZ European Commission DG CONNECT/02 Head of Sector 'Integration of Regulation, Policy and Research"
Vessela KARLOUKOVSKA European Commission, DG CONNECT Stakeholders Unit Policy officer
Prabhat AGARWAL European Commission DG CONNECT Policy Officer
Group Participants
Twitter