After years of debating U.S. Internet subscribers now have Government regulated Net Neutrality. A huge step forward according to some, but the full order released a few days ago reveals some worrying caveats. While the rules prevent paid prioritization, they do very little to prevent BitTorrent blocking, the very issue that got the net neutrality debate started.

In 2007 we uncovered that Comcast was systematically slowing down BitTorrent traffic to ease the load on its network.

The Comcast case was the first to ignite a broad discussion about Net Neutrality. It became the setup for the FCC’s Open Internet Order which was released three years later.

This Open Internet Order was the foundation of the Net Neutrality rules the FCC adopted two weeks ago. The big change compared to the earlier attempt is that ISPs can now be regulated as carriers under Title II.

Interestingly, the exact language of the new rules remained secret until three days ago. The broader concepts, including a ban on paid prioritization and blocking were known, but the fine print was kept secret until everything was signed off on.

Perhaps unsurprisingly, the full text has quite a few caveats.

When we read the new rules it’s clear that the “copyright loophole” many activists protested against in the past is still there. In short, ISPs can still throttle or block certain types of traffic as long as it’s related to copyright infringement.

In its most recent order the FCC has listed the following rule:

“Nothing in this part prohibits reasonable efforts by a provider of broadband Internet access service to address copyright infringement or other unlawful activity.”

The FCC argues that copyright infringement hurts the economy, so ISPs are free to take appropriate measures against this type of traffic. This includes the voluntary censoring of pirate sites, something the MPAA and RIAA are currently lobbying for.

“For example, the no-blocking rule should not be invoked to protect copyright infringement, which has adverse consequences for the economy, nor should it protect child pornography. We reiterate that our rules do not alter the copyright laws and are not intended to prohibit or discourage voluntary practices undertaken to address or mitigate the occurrence of copyright infringement,” the FCC explains.

Interestingly, this issue has been pretty much absent from the discussion in recent months. This is curious as many activist groups, including the Electronic Frontier Foundation (EFF), protested heavily against the copyright loophole in the past, issuing warnings over massive collateral damage.

“Carving a copyright loophole in net neutrality would leave your lawful activities at the mercy of overbroad copyright filtering schemes, and we already have plenty of experience with copyright enforcers targeting legitimate users by mistake, carelessness, or design,” the EFF wrote at the time.

So why was there little outrage about the copyright loophole this time around? TF contacted EFF staff attorney Kit Walsh who admits that the issue didn’t get much attention, but that it’s certainly problematic.

“The language about ‘lawful’ content and applications creates a serious loophole that seems to leave it up to ISPs to make judgments about what content is lawful or infringes a copyright, subject to challenges after the fact about whether their conduct was ‘reasonable’,” Walsh says.

“It’s one thing to say that ISPs can block subject to a valid court order, quite another to let ISPs make decisions about the lawfulness of content for themselves,” he adds.

According to Walsh the issue is particularly concerning because many ISPs also have their own media properties. This means that their incentive to block copyright infringement may be greater than the incentive to protect fair use material.

For example, although the Net Neutrality rules prescribe no blocking and throttling, ISPs could still block access to The Pirate Bay and other alleged pirate sites as an anti-piracy measure. Throttling BitTorrent traffic in general is also an option, as long as it’s framed as reasonable network management.

A related concern is that ISPs can use privacy invasive technologies such as Deep Packet Inspection to monitor users’ traffic for possible copyright violations. The FCC didn’t include any protections against these practices. Instead, it simply noted that people can use SSL, VPNs and TOR to circumvent it.

“The FCC’s response to concerns about deep packet inspection is that users can just use SSL, VPNs and TOR,” Walsh says.

“Of course SSL, VPNs, and TOR are great tools for Internet users to preserve their privacy, but this approach of leaving users to fend for themselves isn’t a great start for the FCC on protecting the privacy of broadband subscribers,” he adds.

The above makes it clear that Net Neutrality has its limits. The problem remains, however, that it’s still unclear how far ISPs can go under the “copyright” and “network management” loopholes.

Previously, the EFF seriously doubted if it was a good idea at all to give FCC control over the Internet. However, as things stand now they are happy with the new rules, even though they aren’t perfect.

Title II regulation with forbearance was the main goal, and that was achieved. In addition, the EFF is also content with the bright line rules against blocking, throttling, and paid prioritization of “lawful” traffic.

“We won a large portion of what we argued for, thanks to a broad coalition of advocates and the voices of four million Americans, but we did not get everything we wanted. We’re clearly better off overall with the order than without, but we’re not going to hesitate to criticize the areas where the FCC gets it wrong,” Walsh says.

Fingers crossed….