The Australian government looks set to overhaul the country's copyright laws with a view to force internet service providers to begin cracking down on users who download TV shows and films over BitTorrent.

Attorney-General George Brandis has said that the government is considering a graduated response scheme for dealing with online copyright infringement, despite telling ZDNet before the election that the party had no policy to take to the election.

In a wide-ranging speech to the Australian Digital Alliance forum in Canberra this morning, Brandis, who is also the minister for the arts, responded in part to the Australian Law Reform Commission's (ALRC) report on reforming the Copyright Act for the digital age . He said that the Act would be simplified, and technology-specific mentions to outdated technologies such as video tapes removed.

He also hinted that the law would be changed to accommodate international trade agreements, such as the Trans-Pacific Partnership currently under negotiation.

"That is particularly important as the Abbott government continues, to number among its signature achievements, the negotiation of free trade agreements with our major trading partners, which, as you all know, contain important provisions concerning copyright and other intellectual property issues," he said.

But the attorney-general said he remains committed to protecting the rights of content owners, and said the government is looking to crack down on online copyright infringement. He said that users downloading TV shows, films, or music over BitTorrent amounts to theft.

"The illegal downloading of Australian films online is a form of theft. I say Australian films, but of course, the illegal downloading of any protected content is a form of theft," he said.

"Some stakeholders have sought the introduction of laws aimed squarely at the scourge of online piracy. While I am sympathetic to their views and am interested in examining new measures that will cut rates of online piracy in Australia, I am not unmindful of the policy challenges of developing the most efficacious regime to do so."

He said that reform of Section 101 of the Copyright Act could potentially be reformed to require ISPs to clamp down on copyright infringement.

"The government will be considering possible mechanisms to provide a 'legal incentive' for an internet service provider to cooperate with copyright owners in preventing infringement on their systems and networks," he said.

"This may include looking carefully at the merits of a scheme whereby ISPs are required to issue graduated warnings to consumers who are using websites to facilitate piracy."

Content owners have been agitating for the government to crack down on online piracy since iiNet defeated the Australian Federation Against Copyright Theft (AFACT) in the High Court in 2012. The court ruled that iiNet has no direct power to prevent its users from using BitTorrent to infringe on copyright, and the notices that AFACT had provided to iiNet were not in a form where it would have been reasonable for iiNet to warn its customers.

They have long called for graduated response schemes, and even requested the ALRC to consider online copyright infringement as part of its review of the Act, despite the terms of reference for the review explicitly excluding it.

Brandis said that such a proposal is "complex" and how it would be paid for is currently unresolved.

"It should also be noted that Australia has international obligations on this point, and that the government will not be seeking to burden ISPs beyond what is reasonably necessary to comply [with] appropriate domestic and international obligations," he said.

"As well, I would like to emphasise that this would not put Australian ISPs at a disadvantage by comparison with their counterparts internationally, as many overseas jurisdictions have the concept of authorisation liability, secondary liability, or similar, which are intended to capture ISPs."

According to Nic Suzor, a senior lecturer in law at the Queensland University of Technology, the cost of implementing such a system will be huge.

"This is the next step in the strategies of Hollywood to push the costs of enforcement out to ISPs. The huge problem is that if a notice-based warning system is going to have any deterrent effect, it likely needs penalties to be imposed in massive numbers," he told ZDNet.

"The cost of doing this legitimately is huge — and really, the only bodies suited to impose penalties are courts. In order to keep costs down, we'll necessarily have problems with due process. These sorts of functions really should not be trusted to private entities."

A recent study on graduated response schemes implemented in the UK, France, and New Zealand, among others, has shown that graduated response schemes do not deter users from infringing on copyright.

While Brandis said he would prefer the industry to implement a self-regulatory copyright scheme, attempts to get a scheme up and running by the previous government came undone after iiNet walked out of the copyright meetings held by the Attorney-General's Department with content owners, ISPs, and consumer groups.

"Industry participants are in the best position to develop a flexible, cooperative self-regulatory approach tailored to particular industry needs. Industry cooperation is a key element in tackling online piracy, and I will continue to encourage industry participants to work together to overcome the outstanding issues in contention," Brandis said.

"I believe in strong protections and enforcement mechanisms in support of Australia's creative industries, but, as I indicated, I am also keen, as one of the achievements in the first-term of the Abbott government, to modernise, reform, and contemporise the Copyright Act."

Brandis said another option the government is considering is giving the Federal Court the power to give injunctions to ISPs, requiring them to block websites hosting infringing content.

Suzor said such a scheme was also trialled in Europe and had failed.

"There is no evidence that website blocking works to limit copyright infringement. It's been tried in Europe — ISPs ordered to block access to The Pirate Bay, but it just doesn't work, for the same reason that mandatory filtering proposals wouldn't work: These technologies are very easy to circumvent," he said.

Brandis also said that he remains to be convinced that the main recommendation for the report — that a flexible fair use regime be implemented — is the right way forward for copyright in Australia.

"I remain to be persuaded that this is the best direction for Australian law, but nevertheless, I will bring an open and inquiring mind to the debate. I am convinced that we can do much to improve how copyright works in this country."

A fair use regime would prevent cloud storage, or local caching, or even copying DVDs onto digital devices from being considered copyright infringement. The content industry has opposed a fair use regime on the basis that there had been "no compelling evidence" that the lack of a fair use system in Australia is restricting commercial activity in Australia.