Internet Firms Seek to Put Liability Shield in New Nafta--Update

By John D. McKinnon Features Dow Jones Newswires

Big internet firms are seeking to get liability protections they enjoy in the U.S. inserted into a renegotiated North American Free Trade Agreement, adding fuel to a fight over the legal shield that some lawmakers say has facilitated online sex trafficking.

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The proposed change to Nafta would mean online platforms in all three countries would be protected from liability for activities of their users, such as harmful or illegal posts. It would generally mirror a law adopted by Congress in the 1990s to promote growth of the internet that has come under increasing fire by critics in recent years.

Proponents of the change, driven by groups such as the Internet Association, a big high-tech trade organization, say Mexico and Canada lack the clear protection of U.S. law, increasing risks for U.S. internet companies.

It is unclear whether U.S. negotiators would adopt the industry's positions in the talks, which are still in their early stages. Emily Davis, a spokeswoman for the U.S. Trade Representative, said the government's digital-trade proposals "will be informed by detailed consultations with Congress and will not prejudice the right of the United States and our Nafta partners to address important public welfare issues."

The industry is making the Nafta bid at a time when the immunity provision is already under fire from lawmakers who say it feeds into illegal sex trafficking. Advocates of limiting the liability protections say writing them into Nafta is an attempt by the industry to complicate initiatives in Congress to rewrite the law.

Such efforts have gained steam in recent weeks with the introduction of a bipartisan Senate measure to modify the current law by allowing victims as well as state law-enforcement officials to take legal action against sites that facilitate trafficking, and by eliminating liability protection for sites that assist, support or facilitate violations of sex trafficking laws.

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Backers of such legislation contend the problems with the current law are exemplified by Backpage.com, a classified-ad site that hosts racy ads that critics say are often thinly disguised solicitations for prostitution. Backpage has successfully fought off a number of lawsuits by alleged child sex-trafficking victims as well as state attorneys general by citing the U.S. immunity law.

Just this week, a California judge tossed out more than a dozen pimping charges against current and former Backpage executives, citing the federal law. The judge allowed some money-laundering charges to move ahead, however.

Backpage says it makes big efforts to sift out illegal ads, including those involving children, and cooperates closely with law enforcement agencies in investigations.

Some tech-backed groups have sided with Backpage in its previous legal fights, and big internet companies such as Alphabet Inc.'s Google and Facebook Inc. have resisted some changes to the 1990s immunity law, worried that reopening it for debate could expose them to new liability. Google and Facebook declined to comment.

Some lawmakers worry that adding the immunity language to Nafta could undercut their legislative efforts.

"The fact that big tech is fighting to spread this protection for online sex trafficking to all of North America, instead of joining the fight to end the online slave trade, is sickening," said a spokeswoman for Rep. Ann Wagner (R., Mo.), a lead sponsor of the House measure, which goes somewhat further than the Senate bill.

In comments to the USTR on Nafta, the Internet Association -- whose members include Google and Facebook -- termed the current U.S. immunity provision "a core foundation of the United States internet economy." The group added that Nafta should follow the U.S. example and "prohibit governments from making online services liable for third-party content."

A spokesman for the association, Noah Theran, said in a statement that the U.S. immunity law "permits billions of internet users to connect and share information online without making platforms liable for every post, review or video posted by individuals."

He added that "a broad swath of international, business and public interest organizations...have supported the inclusion of intermediary liability protections in trade and other international agreements for years."

The efforts also have drawn concern from some consumer and anti-trafficking groups.

"It's the typical political tricks that have led to the current political climate -- politicians playing tricks," said Nic McKinley, executive director of DeliverFund, a group that seeks to disrupt human trafficking.

"It makes no sense to blindly adopt [the liability] provisions in an international trade agreement just as the law in the United States is likely to be amended," said Consumer Watchdog, a California-based group that has been critical of tech firms, in a letter to the USTR. "Internet freedom...must not come at the expense of children who are sex-trafficked."

Tech industry officials privately said that their proposal isn't aimed at undercutting the legislative efforts. They said any provision wouldn't hamper efforts in Congress to carve out exceptions to the immunity shield.

Write to John D. McKinnon at john.mckinnon@wsj.com

WASHINGTON -- Big internet firms are seeking to get liability protections they enjoy in the U.S. inserted into a renegotiated North American Free Trade Agreement, adding fuel to a fight over the legal shield that some lawmakers say has facilitated online sex trafficking.

The proposed change to Nafta would mean online platforms in all three countries would be protected from liability for activities of their users, such as harmful or illegal posts. It would generally mirror a law adopted by Congress in the 1990s to promote growth of the internet that has come under increasing fire by critics in recent years.

Proponents of the change, driven by groups such as the Internet Association, a big high-tech trade organization, say Mexico and Canada lack the clear protection of U.S. law, increasing risks for U.S. internet companies.

It is unclear whether U.S. negotiators would adopt the industry's positions in the talks, which are still in their early stages. Emily Davis, a spokeswoman for the U.S. Trade Representative, said the government's digital-trade proposals "will be informed by detailed consultations with Congress and will not prejudice the right of the United States and our Nafta partners to address important public welfare issues."

The industry is making the Nafta bid at a time when the immunity provision is already under fire from lawmakers who say it feeds into illegal sex trafficking. Advocates of limiting the liability protections say writing them into Nafta is an attempt by the industry to complicate initiatives in Congress to rewrite the law.

Such efforts have gained steam in recent weeks with the introduction of a bipartisan Senate measure to modify the current law by allowing victims as well as state law-enforcement officials to take legal action against sites that facilitate trafficking, and by eliminating liability protection for sites that assist, support or facilitate violations of sex trafficking laws.

Backers of such legislation contend the problems with the current law are exemplified by Backpage.com, a classified-ad site that hosts racy ads that critics say are often thinly disguised solicitations for prostitution. Backpage has successfully fought off a number of lawsuits by alleged child sex-trafficking victims as well as state attorneys general by citing the U.S. immunity law.

Just this week, a California judge tossed out more than a dozen pimping charges against current and former Backpage executives, citing the federal law. The judge allowed some money-laundering charges to move ahead, however.

Backpage says it makes big efforts to sift out illegal ads, including those involving children, and cooperates closely with law enforcement agencies in investigations.

Some tech-backed groups have sided with Backpage in its previous legal fights, and big internet companies such as Alphabet Inc.'s Google and Facebook Inc. have resisted some changes to the 1990s immunity law, worried that reopening it for debate could expose them to new liability. Google and Facebook declined to comment.

A spokesman for Mexico's Economy Ministry declined to comment on the issue. A spokesman for Canada's Foreign Affairs Minister didn't immediately respond.

Some lawmakers worry that adding the immunity language to Nafta could undercut their legislative efforts.

"The fact that big tech is fighting to spread this protection for online sex trafficking to all of North America, instead of joining the fight to end the online slave trade, is sickening," said a spokeswoman for Rep. Ann Wagner (R., Mo.), a lead sponsor of the House measure, which goes somewhat further than the Senate bill.

In comments to the USTR on Nafta, the Internet Association -- whose members include Google and Facebook -- termed the current U.S. immunity provision "a core foundation of the United States internet economy." The group added that Nafta should follow the U.S. example and "prohibit governments from making online services liable for third-party content."

A spokesman for the association, Noah Theran, said in a statement that the U.S. immunity law "permits billions of internet users to connect and share information online without making platforms liable for every post, review or video posted by individuals."

He added that "a broad swath of international, business and public interest organizations...have supported the inclusion of intermediary liability protections in trade and other international agreements for years."

The efforts also have drawn concern from some consumer and anti-trafficking groups.

"It's the typical political tricks that have led to the current political climate -- politicians playing tricks," said Nic McKinley, executive director of DeliverFund, a group that seeks to disrupt human trafficking.

"It makes no sense to blindly adopt [the liability] provisions in an international trade agreement just as the law in the United States is likely to be amended," said Consumer Watchdog, a California-based group that has been critical of tech firms, in a letter to the USTR. "Internet freedom...must not come at the expense of children who are sex-trafficked."

Tech industry officials privately said that their proposal isn't aimed at undercutting the legislative efforts. They said any provision wouldn't hamper efforts in Congress to carve out exceptions to the immunity shield.

Write to John D. McKinnon at john.mckinnon@wsj.com

(END) Dow Jones Newswires

August 24, 2017 18:22 ET (22:22 GMT)