BT and TalkTalk have asked the High Court to conduct a judicial review of the law, which was passed amidst the horse-trading and rushed compromise of the controversial 'wash up' process that took place just before this year's general election.
That process allows the passing of potentially large numbers of laws as long as the opposition does not seek to block them. This gives the opposition significant power and deals are made between Government and opposition without the usual Parliamentary or public scrutiny.
The progress of the Digital Economy Act was already seen as rushed before it entered the wash-up period and it has been criticised for imposing significant obligations on ISPs without proper consideration of the effects of its measures.
The law allows for the passing of regulations that would, for the first time, force ISPs to disconnect their customers if intellectual property rights holders believed that an account was used for the unauthorised sharing of copyrighted material.
BT and TalkTalk said in a statement that they are "seeking clarity" from the High Court on the legality of the law's provisions before spending significant sums on systems to implement them.
"The companies share a concern that obligations imposed by the Act may not be compatible with important European rules that are designed to ensure that national laws are proportionate, protect users’ privacy, restrict the role of ISPs in policing the Internet and maintain a single market," said the statement.
The UK has laws that implement EU directives on data protection and electronic privacy that control how organisations gather, process and use information online. They also govern what information can be gathered from electronic communications and say that ISPs should not be responsible for material sent over their network unless informed about infringements of the law.
The ISPs want the High Court to rule on whether the Digital Economy Act conflicts with existing laws based on these directives.
"If clarity is not gained at this stage then BT, TalkTalk and other industry players may end up investing tens of millions of pounds in new systems and processes only to find later that the Act is unenforceable and the money wasted," the companies said in a statement.
"The Digital Economy Act's measures will cost the UK hundreds of millions [of pounds] and many people believe they are unfair, unwarranted and won't work," said TalkTalk chairman Charles Dunstone. "It’s no surprise that in Nick Clegg’s call for laws to repeal, this Act is top of the public’s ‘wish list’."
"Innocent broadband customers will suffer and citizens will have their privacy invaded. We think the previous Government's rushed approach resulted in flawed legislation," he said. "That’s why we need a judicial review by the High Court as quickly as possible before lots of money is spent on implementation."
Technology lawyer Struan Robertson of Pinsent Masons, the law firm behind OUT-LAW.COM, said that once a law has been passed by the country's elected representatives in Parliament there is little that unelected judges can do to change it.
"It is not in the power of the courts to throw out a primary Act of Parliament," said Robertson. "All the court can do is make a declaration that a law is in breach of other obligations. That declaration would put pressure on Parliament to revisit the Act."
"This law was rushed through Parliament and didn't get the scrutiny it deserved. It's a bad law, in my view. Unfortunately, it won't be easy to change it unless and until there is political will to do so," he said. "The courts can't just strike it down."
"It’s disappointing that we feel the need to take action but we feel we have no choice," said BT Retail chief executive Gavin Patterson. "We have to do this for our customers who otherwise run the risk of being treated unfairly. Our dispute is not with the current Government but with the previous administration which pushed this through without due process. We need clarity about whether this legislation is compatible with important EU laws.”
