The company removed the offending site from its French portal,
yahoo.fr, to comply with the French law against the sale or
exhibition of anything that incites racism; but it refused to
remove the auction from yahoo.com because it is not in breach of US
law. The case was brought by two human rights groups based in
Paris.
Judge Gomez instructed Yahoo! to put in place filtering systems
that should block the majority of French users. Following the
recommendations of a three-member panel of experts who reported to
the court earlier this month, the filtering measures will block
French users recognised by their IP address, their use of any of
ten keywords, and their self-identification of geographic location.
The experts suggested to Judge Gomez that the systems are likely to
be 90% effective.
Yahoo! has been given three months to put the filtering systems
in place. If it fails to do so, the company faces fines of
FFr100,000 (£9,093) per day.
Yahoo! argues that its US-based site should not be subject to
French law. A spokeswoman for the portal said: “Does one country
have jurisdiction to regulate companies in another country?”
Yahoo! could ask a US court to refuse recognition of the French
judgement on the grounds that a French court has no power to impose
these sanctions on a US company and that under US law there is a
constitutional right to freedom of speech. Yahoo! has no assets in
France, so for the judgement to be effective it has to be
enforceable in the US.
Jon Fell, a partner of IT law specialists Masons and co-founder
of OUT-LAW.COM, said:
"This case highlights one of the most
difficult legal issues facing the internet. Any business using the
internet is potentially subject to the laws of each country in
which its web site can be accessed. Whilst the US and Europe have
adopted different approaches to the question of which courts have
jurisdiction and which laws will apply to contracts entered into
on-line, a common theme has been the need for businesses to target
their web sites at a specific audience in certain circumstances.
This has been particularly true in the area of financial services
and on-line gaming, where it may be unlawful to undertake such
business in particular countries.
"In the US the courts have consistently
taken the approach that a transactional web site, i.e. one through
which contracts can be entered into, will be sufficient to create a
place of business enabling the courts to seize jurisdiction.
However, the courts have recognised that businesses should be able
to ring fence their sites so as to ensure that they are not
undertaking business in a particular state. The inclusion of
disclaimers and notices making it clear that the owner of the site
will only sell its goods or services to people located in certain
countries is not in itself sufficient to protect a business. Rather
it is essential that this is backed up by back office procedures
and technical measures.
"In many respects, if Yahoo! wants to ensure
that it is not breaking French Law it should be taking the steps
required by the French Court of its own volition in relation to the
yahoo.com site and all of its other sites. Whether the US courts
will uphold the decision of the French Court and enforce the fine
is quite a different matter."
