At the last minute, Kim Dotcom has pulled the plug on his January 20 “Party Party” event at Auckland’s Vector Arena—for which he says 25,000 people had registered for free tickets.

In an e-mail to registered attendees, Dotcom says he cancelled the event after “we received advice that the event could risk breaching electoral laws.”

That advice arrived in the form of phone calls followed up by an e-mail from the Electoral Commission—the independent New Zealand government agency that administers elections and enforces spending and campaign rules.

When invites went out January 14, the Party Party was billed as a release event for Dotcom’s latest album, Good Times, as well as a celebration of his 40th birthday. (The date is no coincidence: January 20 will be the second anniversary of the police raid on Kim Dotcom’s mansion in Auckland, as well as FBI raids in the US that shut down Megaupload. The FBI and the New Zealand Police chose the date because they knew from intercepts that Dotcom lieutenants Mathias Ortman, Finn Batato, and Bram van der Kolk, usually based in Europe, were all flying into Auckland for Dotcom's birthday celebration).

But earlier, Dotcom indicated the launch of Baboom (the music service formerly known as Megabox) and the launch of his political career were also on his January agenda.

In November last year, he told Wired, “We'll do a soft launch of Baboom in January where you will only see my artist page so you can see how the service works and use different options to purchase music or download it for free. The full site will launch a few months later.”

And, more to the Electoral Commission’s interest, he tweeted on January 14, “My political party will activate non-voters, the youth, the Internet electorate. We are going to make politics exciting. More on January 20.”

The entrepreneur also told the National Business Review that January 20 would serve as a soft launch for his political party (as well as his Good Times album launch).

The Commission says it has been following Dotcom’s tweets and did not say the “Party Party” could not go ahead, but it warned that if it did, there was a risk of it breaking Section 217(2) of New Zealand’s Electoral Act, which states that a person commits the offense of “treating” if they provide free food, drink, or entertainment in a bid to directly or indirectly influence potential voters.

The e-mail—which the Commission forwarded to Ars Technica—notes that over the past week, Dotcom has tweeted that the January event would be restricted to his album launch and birthday celebration. But, it adds, “The Commission remains concerned that the action Kim Dotcom intends to take (limiting the event to his 40th birthday and the launch of his music album) may not be sufficient to eliminate the risk of the activity falling within the scope of the treating provisions. This is because the event was originally intended to include the Internet Party launch.”

The politics of dancing

There was also political messiness. Whaleoil, a right-wing blog, leaked an Internet Party strategy document—embarrassing a left-wing blogger and a journalist who were both revealed as having ties to the Internet Party (the journalist, Scoop.co.nz editor and General Manager Alistair Thompson, has since left his post—although accounts vary over whether he is on sabbatical or has quit.) The strategy document also revealed a proposal for a tent city for 300 volunteers on the grounds of Dotcom’s $25 million rented mansion.

It could also raise memories of Dotcom's 2011 pledge to host Mega in New Zealand, and use profits from Mega—and the bandwidth business generated by hosting Mega domestically—to fund investment in a second submarine cable to the US, while using profits to fund free internet for all residential NZ customers (in the event, Dotcom decided to host Mega offshore).

Dotcom did not immediately respond to Ars Technica's questions about when the soft launch of Baboom and the Internet Party will now take place.

Meanwhile, the chattering classes in New Zealand have been sent into a frenzy by the pending launch of Kim Dotcom’s Internet Party, which he says will focus on issues concerning Internet freedom.

The key question is whether the party can cross the 5 percent threshold needed to gain representation under New Zealand’s proportional representation system—which would mean it would have 5% of the representatives in Parliament (which has 120 members minimum, with scope for a handful more under a complicated “overhang” formula).

So far, no polls have been taken since Dotcom formally announced the Internet Party, but registrations of 25,000 for the January 20 event indicate a healthy groundswell of interest (New Zealand has a population of 4.5 million; 2.3 million voted at the last general election, pointing to the Internet Party needing around 120,000 votes to cross that 5 percent threshold.)

Dotcom’s idea is that even if he enters Parliament with just a handful of members of Parliament, the Internet Party could play a kingmaker role as the right-wing National Party (currently in power) and the allied Labour and Green parties (whose combined vote is roughly equal to National’s) vie for his support to form a government.

Some political commentators believe Dotcom does have a good chance of crossing the threshold.

Dotcom has already proved he can wow youth. “A crowd of thousands of young Kiwis screaming 'KIM DOTCOM!' from the top of their lungs for a solid 10 minutes” says TV3 in its report on his performance at the Rhythm and Vines music festival on New Year’s Eve.

And at anti-spy bill rallies in town halls, he has spoken to hundreds, many of them closer to middle age.

Taking a stand

Dotcom was also a high-profile campaigner against two controversial pieces of legislation during 2013 (as were the opposition Labour and Green parties).

One was the Government Communications Security Bureau (GCSB) and Related Legislation Amendment Bill, which made it legal for the GCSB—roughly speaking, New Zealand’s equivalent of the CIA—to spy on New Zealand citizens and residents. The legislation was sparked by the GCSB’s illegal surveillance of Kim Dotcom (who has legal status as a New Zealand resident, though not full citizenship) in the buildup to the January 20 raid. The legislation does not apply retrospectively. The Court of Appeal has upheld Dotcom’s right to sue the GCSB following its admission of wrongdoing. The case will be heard in March.

The other was The Telecommunications (Interception Capability and Security) Bill, which gives the GCSB sweeping new powers. Service providers were already required to make their networks interceptable; now they must also consult with the GCSB on network design and choice of hardware and software partners.

Both pieces of legislation passed, but Dotcom was an articulate, high-profile opponent of each of the so-called “spy bills” both at a series of public rallies attended by thousands and in a televised select committee showdown with Prime Minister John Key—which ranged from Dotcom’s technical critique of the GSCB Bill, which he said would help facilitate New Zealand’s participation in an international mass surveillance “spy cloud” to a schoolyard slang match as Dotcom’s submission wound up (Dotcom: "Why are you turning red, Prime Minister?"; Key: "I'm not. Why are you sweating?").

Dotcom will also presumably oppose the recently introduced “Skynet” or “Three-strikes” Internet file sharing law, aka the Copyright (Infringing File Sharing) Amendment Act. The law has two major flaws, say critics. One is that it makes an Internet account holder (such as a householder, employer, or school) responsible for anyone who illegally downloads from their account, even if the account holder is totally ignorant of the fact that their account is being abused (as in the case of a soldier who submitted he was overseas serving in Afghanistan when three songs were illegally downloaded using his Internet connection back in New Zealand; he was fined $NZ255.97 ($US225). The second is Section 122, the “presumption of guilt” in that section of the Act.

There's one fly in the ointment, though. Disaffected young voters and Internet freedom advocates in the Labour-Greens bloc may not be impressed by Dotcom’s decision to donate $50,000 to conservative politician John Banks when he contested the Auckland Mayoralty in 2010.

Banks, who lost the Mayoral election to the Labour-aligned Len Brown, later got into hot water for declaring the $50,000 donation as anonymous. Crown Law, which asserts he did know the source of the donation, is prosecuting Banks for electoral fraud. The case will be heard early this year; publicity surrounding it has already forced Banks to resign from Parliament where he is the sole MP for the hard right ACT Party. Banks did not return Dotcom’s plea for help after he was jailed in January 2012. The pair fell out and Dotcom is now an enthusiastic witness for the prosecution.

The electoral fraud case is intriguing, but some of Dotcom’s Internet freedom-advocating supporters might wonder why he donated $50,000 to Banks—a long-time authoritarian and social conservative. In keeping with his previous voting patterns, Banks supported both of the spy bills. Dotcom says he and Banks had a shared interest in “improving digital business."

Further muddying the waters, former National Party and ACT leader Don Brash says he has consulted with Kim Dotcom on Internet Party policy.

On Twitter, Dotcom said, “The Internet Party is neither left or right. It’s UP!”

The party’s logo is purple and white—politically neutral colors (and also those used by Orcon, a local ISP that hired Dotcom as its pitchman. He continues to appear in Orcon ads and push the ISP on his Twitter feed).

On InternetNZ’s Policy Advisory Group forum, members are looking for detailed information from the Internet Party—detail that will prove the political newcomer is serious about an open, uncapturable Internet, and not just Dotcom showboating.

They’re likely to get it. Mega’s CEO is Vikram Kumar, the former policy insider at the government’s State Services Commission and one-time CEO of InternetNZ (which administers the .nz domain). Kumar was one of the most effective critics of the spy bills.

For his part, Kumar stresses to Ars Technica that while he may give the Internet Party advice, like every Mega employee, he is “available to any and every political party” who wants to pick his brains on policy.

On social media, there has been no shortage of jokes about how the Internet Party gaining seats in Parliament could help Dotcom’s casse. "How can the Prime Minister extradite me if I am the Prime Minister! - Kim Dotcom. International super villain,” quipped comedian Guy Williams (@guywilliamsguy).

In truth, there would be no legal advantage.

The Dotcom affair has highlighted the best and the worst of New Zealand’s justice system.

The worst has been the GCSB overstepping its domestic surveillance powers and police partaking in an over-the-top raid on Dotcom mansion, seemingly in a boyish attempt to impress observing FBI agents.

The best has been more evidence that New Zealand has a strong, independent judiciary, immune to political pressure. The GCSB and the Police have been called out on numerous procedural and legal blunders. And whatever promises Prime Minister John Key might have made to the US about a quick extradition, the case, and any appeals, are now set to take years. Key is left fuming on the sidelines. In power, the Internet Party would hold no more sway.

Dotcom—or a successful Internet Party candidate—would gain one key advantage, however. Members of Parliament are allowed to talk in the House of Representatives under privilege, meaning they have almost unfettered freedom of speech, as well as freedom from defamation laws. Dotcom often tells journalists his theories about the GCSB, the Prime Minister, and others that stray deep into libel territory and can’t be repeated in public. Under Parliamentary privilege, we could see Dotcom in full song—and that could be something that at least 5 percent of New Zealanders would happily vote to see.

On the face of it, Section 47(1) of New Zealand's Electoral Act says you must be a citizen to stand for Parliament. However, in September, Dotcom told the Washington Post, "When I made that statement, my lawyers were still looking into it, and their preliminary answer was that you can only run as a citizen of New Zealand. But they went through the full several hundred pages of New Zealand election law, and they found that if I’m a permanent resident of New Zealand who’s lived here for more than a year and is a registered voter—which I will be in November—you can run for office."

The next general election is expected in November of this year (under New Zealand's parliamentary system, the government gets to choose the ballot date; the next election must be held before January 24, 2015).

Chris Keall is technology editor at New Zealand's National Business Review.