New German telemedia legislation clarifies some issues; clouds others

The new German Telemedia Act (Telemediengesetz or TMG) and the Ninth Amendment of the Interstate Treaty on Broadcasting (Rundfunkstaatsvertrag or RStV) went into effect on March 1, 2007. The TMG replaces the Teleservices Act (Teledienstegesetz or TDG), the Teleservices Data Protection Act (Teledienstedatenschutzgesetz or TDDSG) and the Interstate Treaty on Media Services (Mediendienstestaatsvertrag or MDStV) and provides the new legal framework for electronic information and communication services in Germany. The e-business community should be glad to know the new act provides for greater legal certainty for providers of electronic services in Germany. However, the TMG also leaves a number of issues unresolved.

Previous Regulation of Electronic Services in Germany

Prior to the creation of this uniform law, e-information and e-communications providers had to refer to a number of different statutes to identify the relevant legal requirements governing their offerings. Electronic services were primarily governed by the Teleservices Act, the Teleservices Data Protection Act (both covering teleservices), the Interstate Treaty on Media Services (covering media services), the Interstate Treaty on Broadcasting (covering nationwide audio and television broadcasting) and the Telecommunications Act (Telekommunikationsgesetz or TKG, covering telecommunications services).

Before a provider could even determine which of these regulations applied, it had to determine whether its service was categorized as a teleservice, media service, telecommunications service or broadcasting. However, the distinction between these categories was often complex or even impossible to determine.

For example, legal scholars and courts have vigorously debated the proper qualification of internet access, e-mail services, internet protocol television (IPTV), voice-over-IP (VoIP), video-on-demand (VoD) and mobile television service providers ever since these services have emerged without—as yet—a satisfying result. As a consequence, providers of electronic services have often felt constrained to comply with the strictest requirements in order to avoid sanctions from regulatory authorities or from competitors. To address at least some of these problems, the German legislature decided to reform the laws governing electronic services, which led to the enactment of the TMG.

Teleservices and Media Services Merge to Become Telemedia

The main objective of the Telemedia Act is to mitigate the problems surrounding the classification of electronic services and to provide a uniform legal framework covering the various electronic information and communication offerings. To achieve this objective, the Telemedia Act abandons the former distinction between teleservices and media services. Instead, the act now defines all electronic information and communication services (with the exception of telecommunication services consisting entirely of signal distribution via telecommunications networks and broadcasting) as telemedia. It also states that value-added services (defined in section 3 number 25 of the TKG) do not fall within the definition of telemedia and are governed exclusively by the TKG.

Legislators have further clarified the classifications of formerly disputed services. As a general rule, services that have previously been classified as teleservices or as media services now fall under the definition of telemedia. This applies, for example, to online shopping, online newspapers and newsletters, search engines, video-on-demand services, and the distribution of advertising e-mails. Voice-over-IP, on the other hand, constitutes mere telecommunication and, therefore, falls outside the scope of the TMG.

Under previous law, some courts qualified VoIP as a teleservice or media service, arguing that voice transmission via internet protocol was not possible in real time and should therefore be treated differently from conventional telephony. In the light of recent technical developments, legislators disagreed with this opinion and decided that VoIP should not be treated differently than conventional telephony. Live streaming and/or web-casting of conventional television or audio programs also falls outside the scope of the TMG, as it constitutes broadcasting within the definition of the Interstate Treaty on Broadcasting. The legislators stressed the distinction between teleservices and broadcasting does not depend on the technical means of signal distribution (satellite, cable, terrestrial or internet/DSL) but on the relevance of the content for the forming of opinions (Meinungsbildungsrelevanz). So far, it seems the TMG has undoubtedly led to a higher degree of legal certainty for electronic information and communications services providers.

Unresolved Issues and Future Prospects

However, the new Telemedia Act leaves a number of important issues unresolved. Providers still have to distinguish between telemedia (covered by the TMG), telecommunication (covered by the TKG) and broadcasting (covered by the Interstate Treaty on Broadcasting). The new section 20 paragraph 2 of the RStV causes even more confusion. It seems to imply that certain electronic information and communication services that do not constitute broadcasting within the meaning of the RStV may in fact be “associated” with broadcasting, meaning that providers of such services would have to obtain a broadcasting license according to German state law. Moreover, the newly amended Interstate Treaty on Broadcasting now contains special provisions for “telemedia with journalistic and editorial content,” which are basically the same services formerly known as “media services.” As a consequence, the ostensibly abandoned differentiation between teleservices and media services may still remain an issue, albeit in a new outfit.

Further Reform?

Unfortunately, the TMG makes practically no changes to the content of the law but simply adopts previous regulations from the TDG and TDDSG to a large extent, even though legislators acknowledge that there is an urgent need for substantial changes, e.g., to the provisions on service providers’ responsibilities. Some observers expect that the new TMG will have only a short lifespan and German telemedia law will again be subject to reform within the next few years.