Two New Zealand ISPs have reported falling traffic after that nation's controversial new "three strikes" copyright enforcement legislation went into effect at the start of the month. Kiwi Internet users may have been spooked by the threat of fines as high as NZ$15,000.

The New Zealand ISP Orcon has said that international traffic into New Zealand has dropped by about 10 percent since last week. Speaking to to the New Zealand Herald, Orcon's chief executive Scott Bartlett said that peer-to-peer file sharing represents the second-largest source of traffic after video streaming.

TelstraClear, another major New Zealand ISP, has also reported a drop in traffic, although a spokesman said he wasn't sure if it was related to the new copyright law. A third firm, Telecom New Zealand, says it hasn't noticed a drop in traffic.

These reports suggest that the fall in traffic in New Zealand has been modest, especially compared to the plunge in Internet traffic that was observed in Sweden the day a tough new Swedish copyright bill took effect. Swedish traffic fell by about 30 percent the week after the Swedish law went into place, and it didn't regain its previous levels for another six months.

The New Zealand law was passed earlier this year, and places the burden of proof on accused file-sharers; repeat offenders can face fines of up to NZ$15,000. The government also has an option to impose Internet disconnections of up to six months as a penalty for repeat infringement.

New Zealand network operators say they have yet to receive any complaints under the new "three strikes" system, but they expect complaints to start rolling in soon.

In June, the New Zealand government signed a statement condemning "three strikes" policies that deprive copyright infringers of Internet access, calling such laws a violation of human rights.