12 September 2015


''Unable to Return' in the 1951 Refugee Convention: Stateless Refugees and Climate Change' by Heather Alexander and Jonathan Simon in (2015) 26(3) Florida Journal of International Law comments 
 it is not only a point of literal construction, but also inherent in the object and purpose of the 1951 Refugee Convention, that displaced stateless persons unable to return to their countries of former habitual residence may be eligible for refugee status even if unpersecuted. 'Unable to return' as it occurs in the clause following the semi-colon of 1(A)2 of the 1951 Refugee Convention must be understood as a term of art subject to appropriate canons of construction in its own right. Its construal must therefore be more restrictive than many commentators have suggested, though not so strict as to preclude all but persecuted persons. Then argues that, as a case study, those who are displaced from their island nations because those nations have submerged beneath the sea will count as 'unable to return' in the relevant sense, and so will qualify for Convention refugee status, if they count as lacking a nationality, i.e. as stateless.

Trust in Privacy Law

'Taking Trust Seriously in Privacy Law' by Neil M. Richards and Woodrow Hartzog comments 
Trust is beautiful. The willingness to accept vulnerability to the actions of others is the essential ingredient for friendship, commerce, transportation, and virtually every other activity that involves other people. It allows us to build things, and it allows us to grow. Trust is everywhere, but particularly at the core of the information relationships that have come to characterize our modern, digital lives. Relationships between people and their ISPs, social networks, and hired professionals are typically understood in terms of privacy. But the way we have talked about privacy has a pessimism problem – privacy is conceptualized in negative terms, which leads us to mistakenly look for “creepy” new practices, focus excessively on harms from invasions of privacy, and place too much weight on the ability of individuals to opt out of harmful or offensive data practices.
But there is another way to think about privacy and shape our laws. Instead of trying to protect us against bad things, privacy rules can also be used to create good things, like trust. In this paper, we argue that privacy can and should be thought of as enabling trust in our essential information relationships. This vision of privacy creates value for all parties to an information transaction and enables the kind of sustainable information relationships on which our digital economy must depend.
Drawing by analogy on the law of fiduciary duties, we argue that privacy laws and practices centered on trust would enrich our understanding of the existing privacy principles of confidentiality, transparency, and data protection. Re-considering these principles in terms of trust would move them from procedural means of compliance for data extraction towards substantive principles to build trusted, sustainable information relationships. Thinking about privacy in terms of trust also reveals a principle that we argue should become a new bedrock tenet of privacy law: the Loyalty that data holders must give to data subjects. Rejuvenating privacy law by getting past Privacy Pessimism is essential if we are to build the kind of digital society that is sustainable and ultimately beneficial to all – users, governments, and companies. There is a better way forward for privacy. Trust us.

Legal Automation

'Four Futures of Legal Automation' by Frank A. Pasquale III and Glyn Cashwell in (2015) 63 UCLA Law Review Discourse 26-48 comments
Simple legal jobs (such as document coding) are prime candidates for legal automation. More complex tasks cannot be routinized. So far, the debate on the likely scope and intensity of legal automation has focused on the degree to which legal tasks are simple or complex. Just as important to the legal profession, however, is the degree of regulation or deregulation likely in the future.
Situations involving conflicting rights, unique fact patterns, and open-ended laws will remain excessively difficult to automate for an extended period of time. Deregulation, however, may effectively strip many persons of their rights, rendering once-hard cases simple. Similarly, disputes that now seem easy, because one party is so clearly in the right, may be rendered hard to automate by new rules that give now-disadvantaged parties new rights. By explaining how each of these reversals could arise, this Essay combines technical and sociological analyses of the future of legal automation. We conclude that the future of artificial intelligence in law is more open ended than most commentators suggest. ...
The first scenario, a Vestigial Legal Profession, can be expected in legal practice areas now serving industries that continue to deregulate. For advocates of disruptive innovation like Harvard Business School Professor Clayton Christensen, that is a consummation devoutly to be wished. Christensen’s acolytes in the legal academy tend to see much of law as little more than a transaction cost imposed on job-creating businesses. From their perspective, automation both reflects and reinforces trends toward laissez-faire deregulation. Simple, precise legal rules are easy to automate. As attorneys’ roles are increasingly taken over by machines, their social prestige declines—thus vitiating their ability to propose more complex or expansive regulatory regimes.
But what happens if artificial intelligence and regulation both advance? This scenario portends what French social theorist Gilles Deleuze called a “Society of Control;” namely, a world in which human action is increasingly managed and monitored by machines. As Peter Reinhardt recently observed, at firms like Uber and 99designs, “lines of code directly control real humans.” In government, too, software can effectively make determinations about who will be audited, who will receive benefits, or who will be denied access to a flight. It is possible to imagine whole areas of law relegated to computational implementation. For example, Lawrence Solum has posited (not endorsed) the development of an “Artificially Intelligent Traffic Authority (AITA),” which could “adapt itself to changes in driver behavior and traffic flow.” The system would be designed to “introduce random variations and run controlled experiments to evaluate the effects of various combinations on traffic pattern.” But the system would not be very forgiving of individual experimentation with, say, violating its rules. Rather, as imagined by Solum, “[v]iolations would be detected by an elaborate system of electronic surveillance” and offenders would be “identified and immediately . . . removed from traffic by a system of cranes located at key intersections.”
Solum uses this example to break down the usual distinctions between human and artificial meaning in the law, rather than as a policy proposal for the future of transportation. The scenario is just as useful to flag the inevitable legal and political aspects of automated law enforcement, even in an area as seemingly technical as traffic. Would the cranes posited in Solum’s hypothetical surgically remove protesters, like the Ferguson marchers, who blocked highways? Would anyone with an expired license or tags be plucked away as well — in a vision already half-realized by subprime lenders who stop cars remotely as soon as a payment is late?
Both the Vestigial Legal Profession and Society of Control scenarios may seem unduly futuristic—and indeed warrant skepticism. As the third scenario — Status Quo — suggests, it is entirely possible that legal automation will move forward far more slowly than many predict or expect. While the legal profession may decline in importance (if not in employment levels), it may not be nearly as susceptible to automation as other fields.
By contrast, robust growth in jobs for those with legal training would likely occur under a fourth scenario, called the “Second Great Compression.” Among economists, the Great Compression is the period from roughly 1947 to 1979 when income growth was roughly evenly distributed among quintiles. Since 1979, most income gains have gone to the top quintile, and within that group, trend toward concentration of income would take very high levels of legal regulation of enterprises, and a rebalancing of the relative power of the state and business to favor the enhanced autonomy of the former. Each trend in the Second Great Compression scenario would increase the power (and, likely, the earnings) of attorneys.
By describing these trends in greater detail below, this Essay illuminates the relative plausibility of each scenario. It takes seriously the possibility of both self-fulfilling and self-preventing prophecies. Both Status Quo and Second Great Compression are likely to be more humane scenarios than Vestigial Legal Profession and Society of Control. This work is designed to make it more difficult for key policymakers to accept either of those high-automation scenarios uncritically. And if these substandard scenarios do indeed come to pass, at least the profession was warned in advance.

11 September 2015

Indigenous Recognition

The WA Parliament has passed the Constitution Amendment (Recognition of Aboriginal People) Bill 2014 (WA).

The Explanatory Memo to that private members Bill states
Parliamentary legislation in other jurisdictions has been enacted, or is currently in passage through Parliaments, to provide constitutional recognition of Aboriginal Australians as the first peoples of our country.  
South Australia was the most recent State to recognise Aboriginal people in its State constitution through the Constitution (Recognition of Aboriginal Peoples) Amendment Bill 2012, which was introduced into the South Australian Parliament on 29 November 2012, passed on 5 March 2013 and assented to on 28 March 2013. The New South Wales Parliament introduced the Constitution Amendment (Recognition of Aboriginal People) Bill 2010 on 8 September 2010, passed the Bill on 19 October 2010 and received Royal Assent on 25 October 2010. Queensland introduced the Constitution (Preamble) Amendment Bill 2009 on 24 November 2009, passed it on 23 February 2010 and the Bill received assent on 25 February 2010. The first State in Australia to give constitutional recognition to Aboriginal people was Victoria, which introduced the Constitution (Recognition of Aboriginal People) Bill 2004 on 26 August 2004, passed the Bill on 4 November 2004 and it was assented to on 9 November 2004. At a Federal level, the Aboriginal and Torres Strait Islander Peoples Recognition Bill 2012 was passed by the House of Representatives on 13 February 2013 and was read into the Senate on 25 February 2013.  
This Western Australian Bill recognises that Aboriginal people are the original custodians of Western Australia and that the settlement by European people was done without consultation with those original inhabitants.  
Advice was sought from the Solicitor General in 2004 as to whether any legal consequences flowed from inserting these words into the Preamble of the Constitution Act 1889 and the advice was as follows:
I do not believe that an amendment to the preamble in these terms would have any significant legal consequences. I would see it as principally a statement of historical fact.
The advice from the Solicitor General of 2004 goes further:
In terms of its constitutional significance, it could only be relevant to the extent that it might be the foundation for some implied limitation on the legislative power of the Parliament. However, I find it difficult to see how any limitation of substance could be constructed from such a provision.
The Memo goes on to state -
This Clause provides an update to include Western Australia’s accession to statehood as a part of the federation of Australia. These words also contain the recognition of the Aboriginal inhabitants of Western Australia as the First Peoples of Western Australia and that they are also the traditional custodians of the land. The amendment also makes explicit that, through this Bill, Parliament seeks to effect reconciliation with Western Australia’s Aboriginal people.
The current Preamble states -
Whereas by the 32nd section of the Imperial Act passed in the session holden in the 13th and 14th years of the Reign of Her present Majesty 2 , intituled “ An Act for the better Government of Her Majesty’s Australian Colonies ”, it was among other things enacted that, notwithstanding anything thereinbefore contained, it should be lawful for the Governor and Legislative Council of Western Australia, from time to time, by any Act or Acts, to alter the provisions or laws for the time being in force under the said Act or otherwise concerning the election of the elective members of such Legislative Council, and the qualification of electors and elective members, or to establish in the said Colony, instead of the Legislative Council, a Council and a House of Representatives, or other separate Legislative Houses, to consist of such members to be appointed or elected by such persons and in such manner as by such Act or Acts should be determined, and to vest in such Council and House of Representatives, or other separate Legislative Houses, the powers and functions of the Legislative Council for which the same might be substituted; and whereas it is expedient that the powers vested by the said Act in the said Governor and Legislative Council should now be exercised, and that a Legislative Council and a Legislative Assembly should be substituted for the present Legislative Council, with the powers and functions hereinafter contained:  
Be it therefore enacted by His Excellency the Governor of Western Australia and its Dependencies, by and with the advice and consent of the Legislative Council thereof, as follows: —
It is amended through insertion of -
And whereas the Legislature of the Colony, as previously constituted, was replaced through this Act with a Parliament, to consist of the Queen, the Legislative Council and the Legislative Assembly with the members of both Houses chosen by the people, and, as constituted, continued as the Parliament of the Colony until Western Australia’s accession as an Original State of the Commonwealth of Australia in 1901 and thereafter has been the Parliament of the State;  
And whereas the Houses of the Parliament resolve to acknowledge the Aboriginal peoples as the First Peoples of Western Australia and traditional custodians of the land, the said Parliament seeks to effect a reconciliation with the Aboriginal peoples of Western Australia:

Disability Discrimination

In Mulligan v Virgin Australia Airlines Pty Ltd [2015] FCAFC 130 the Federal Court of Australia Full Court (FCAFC) has found that the Federal Circuit Court of Australia misconstrued reg 256A of the Civil Aviation Regulations 1988 (Cth) in finding that the provision applied only to persons assisted by assistance animals who had visual or hearing impairment only, and excluded a passenger who had additional disabilities.

The judgment states
This appeal raises some important issues concerning the proper construction and application of various provisions in the Disability Discrimination Act 1992 (Cth) (DDA) and their interrelationship with various laws and instruments which affect civil aviation. A central issue is whether the respondent airline unlawfully discriminated against the appellant, who claimed to suffer from cerebral palsy which affected his vision and mobility, when the airline refused to allow his dog, Willow, to accompany him in the aircraft cabin
The FCAFC declared that the conduct of Virgin Australia Airlines Pty Ltd in refusing to allow an assistance dog accompany a passenger who suffered from cerebral palsy which affected his vision and mobility constituted unlawful discrimination under Disability Discrimination Act 1992 (Cth) s 24.

Virgin was ordered to pay damages by way of compensation to the appellant for the stress suffered as a consequence of its unlawful conduct during the period from at least December 2010 to at least September 2012 in the sum of $10,000 plus interest in accordance with s 51A of the Federal Court of Australia Act 1976 (Cth). Virgin was also ordered to pay the appellant’s costs of the proceeding below, the appeal, the amended notice of contention and the amended cross-appeal.

The Full Court, at [35], states that the reasons for the decision in the first instance judgment -
it may be noted, were given in an ex tempore judgment. It must necessarily be recognised that the attributes of different judges vary enormously and that appellate courts stand in a very different position to a trial court having a large volume of cases, such as the FCCA: M D Kirby, ‘Ex tempore Reasons’, (1992) 9 Australian Bar Review 93. In a case such as the present, however, where the factual findings to be made and the legal conclusions to be reached were not easy of resolution, it was perhaps surprising that the primary judge decided to deliver ex tempore reasons rather than to first pause for reflection. Any experienced judge may have hesitated – and, perhaps, avoided error.
That disquiet reflects [93] to [106] -
93. The primary judge’s reasons for judgment reveal numerous appellable errors.  
94. First, his Honour erred in proceeding on the basis that the Instruments were relevant to Mr Mulligan’s individual circumstances. It is explicitly stated in both Instruments that they were made under reg 256A(1)(b) of the CARs (i.e. not s 256A(2)). Accordingly, those Instruments applied only in respect of a person with a disability other than sight or hearing impairment who required a dog to assist the person to alleviate the effect of the disability. The limited scope of these Instruments is reinforced by the definition therein of “handler”, which is defined to mean “the person with a disability other than sight or hearing impairment who relies on the dog” (emphasis added). As the AHRC contended, any permission given by CASA under reg 256A(1)(b) has no work to do with respect to a dog as described in reg 256A(2). The primary judge’s erroneous belief that the Instruments were relevant and, indeed, determinative of the case was a fundamental error. That error permeated the entirety of the primary judge’s reasoning.  
95. Virgin Australia acknowledged that the primary judge erred in his interpretation of reg 256A(1) and (2) but it sought to defend the dismissal of Mr Mulligan’s application on other grounds which will be considered below.  
96. Secondly, the primary judge’s misconstruction of the Instruments and failure to appreciate the distinction between reg 256A(1)(b) and (2) led to the following further related error. Contrary to the primary judge’s findings in [11] and [12] of his reasons for judgment, reg 256A(2) is not properly characterised as being in “the nature of a defence”. We accept the AHRC’s submission that the effect of reg 256A(2) is that an operator is not prohibited from permitting a dog to travel in the cabin with a disabled person if the dog is a guide or an assistant to the disabled person (assuming that reg 256A(8) has no application). If, however, an operator refuses to carry such a dog and the circumstances specified in reg 256A(2) are otherwise satisfied, this may constitute unlawful discrimination under the DDA.  
97. Thirdly, the primary judge misconstrued reg 256A(2) in [13] of his reasons for judgment when he adopted an unduly narrow view in implying that, for that provision to apply, the person assisted by an assistance dog must have only a visual impairment or hearing impairment, with the consequence that the provision has no application if the person also has an additional disability (such as, in Mr Mulligan’s case, cerebral palsy).  
98. Regulation 256A deals with the carriage of animals in an aircraft. Only reg 256A(2) deals specifically with the carriage in the passenger cabin of an aircraft of a dog that accompanies a person with particular disabilities, namely a person who is visually impaired or hearing impaired, and the dog is a “guide” or an “assistant” to that person. We see no warrant in the language of reg 256A or in the object or purpose of that provision to confine its operation to circumstances where the person being accompanied by the dog must only be visually impaired or hearing impaired and not also have some additional disability, such as cerebral palsy. Plain words would be required to support the narrow construction adopted by the primary judge.  
99. It is convenient to note at this point that Virgin Australia contended that the phrase “a dog accompanying a visually impaired or hearing impaired person as a guide or an assistant” in reg 256A(2) should be construed to read a “guide dog” and an “assistant dog”. For reasons which are developed below, we do not accept that contention.  
100. Fourthly, the primary judge’s misconstruction of reg 256A(2) was accompanied by the following further errors. His Honour’s finding at [4] and [7] that the Instruments were “exhaustive” in relation to the circumstance in which Virgin Australia was permitted to carry a dog in the cabin was wrong. This finding fails to take into account the nature and effect of reg 256A(2) which, independently of reg 256A(1)(b), does not prevent an aircraft operator such as Virgin Australia from permitting a dog which accompanies a visually impaired or hearing impaired person as a guide or an assistant to be carried in the passenger cabin as long as the prescribed conditions are met. Furthermore, and equally significantly, it is evident that the primary judge’s view that the Instruments were exhaustive as to when Virgin Australia was permitted to carry a dog in the cabin resulted in the primary judge not turning his mind at all to the potential relevance of the issue whether Willow was an “assistance animal” within the meaning of s 9(2) of the DDA and, if so, how that affected the operation and application of reg 256A. It is difficult to understand why the primary judge did not address these important issues, not the least because it was expressly pleaded in [2] of the further amended statement of claim that, at all material times, Mr Mulligan had “an assistance animal” and reference was made to s 9(2)(a) and (c) of the DDA.  
101. Fifthly, as Virgin Australia also acknowledged, the primary judge erred in finding at [8] that the Instruments were a “prescribed law” for the purposes of s 47(2) of the DDA. His Honour stated in [9] that “prescribed law” is defined in s 2B of the AIA and that this “would clearly apply to the instrument, in this case issued by CASA”. That reasoning involves the following overlapping errors: (a) s 2B of the AIA does not define what is a “prescribed law” as such, rather it defines “prescribed” to mean “prescribed by the Act or by regulations under the Act”. Relevantly, this is a reference to a law prescribed by the DDA or by regulations made under the DDA, such as the DDRs. Section 132(2) of the DDA expressly refers to the power to make regulations for the purposes of s 47 of the DDA; and (b) more significantly, several laws are prescribed for the purposes of that provision in reg 2A and Sch 1 of the DDRs. Significantly, however, neither the Instruments nor the CARs are prescribed under either the DDA or the DDRs. Accordingly, they are not a “prescribed law” for the purposes of s 47(2) of the DDA.  
102. Sixthly, the primary judge proceeded on the basis it was common ground that each Instrument was a legislative instrument for the purposes of the LIA and he viewed that factor as relevant to his characterisation of the Instruments as “a prescribed law”. For reasons given above, the finding that the Instruments were a prescribed law was incorrect.  
103. The AHRC made detailed submissions which challenged the primary judge’s finding in [3] of his reasons for judgment that the Instruments were also a legislative instrument within the meaning of the LIA. Virgin Australia conceded in the appeal that the primary judge was wrong to proceed on the premise that the Instruments were legislative instruments and had force and effect in accordance with the LIA. Virgin Australia also accepted that this led the primary judge to conclude that, having regard to s 47(2) of the DDA, Pt 2 of the DDA could have no application in the present case.  
104. Having regard to s 5(2) of the LIA and guiding principles established in decisions such as RG Capital Radio Ltd v Australian Broadcasting Authority [2001] FCA 855; (2001) 113 FCR 185, neither Instrument was a legislative instrument for the purposes of the LIA because: (a) neither Instrument altered the content of the law and, instead, they applied the law to a particular operator, namely Virgin Australia; and (b) neither Instrument was of general application and, instead, they applied only to Virgin Australia and conferred no rights or obligations on persons wishing to travel with assistance animals.  
105. Seventhly, the primary judge erred in interpreting and applying s 54A(5) of the DDA in finding in [15] that there was non-compliance with that provision by reference to the Instruments in that Willow was not trained and identified by an approved organisation. This error was consequential upon the primary judge’s erroneous findings that reg 256A(2) had no application and that the case fell to be determined solely by reference to the Instruments (which required inter alia that Willow be trained and accredited by an approved organisation).  
106. Eighthly, the primary judge’s finding at [16] that, having regard to the Instruments, unjustifiable hardship would arise if Virgin Australia were required to carry Willow in the cabin because this would “be contrary to the express confinement of permission identified in instruments (sic) and as such a potential offence”. This finding involved appellable error because the primary judge focused exclusively on what he regarded to be the effects and operation of the Instruments. He failed to direct his mind to the proper construction and application to the circumstances here of reg 256A(2) or s 9 of the DDA.

10 September 2015

All data is credit data

‘“All Data is Credit Data,” or, On Close Reading as a Reciprocal Process in Digital Knowledge Environments’ by John C. Hunter in (2014) 5(2) Scholarly and Research Communication comments 
The new knowledge environments of the digital age are often described as places where we are all closely read, with our buying habits, location, and identities available to advertisers, online merchants, the government, and others through our use of the Internet. This is represented as a loss of privacy in which these entities learn about our activities and desires, using means that were unavailable in the pre-digital era. This article argues that the reciprocal nature of digital networks means 1) that the privacy issues that we face online are not radically different from those of the pre-Internet era, and 2) that we need to reconceive of close reading as an activity of which both humans and computer algorithms are capable. 
Hunter argues that
 The new knowledge environments of the digital age are often described as places where we are all closely read, with our buying habits, our location, and intimate details of our identities available to advertisers, online merchants, the government, and others through our use of the Internet. This is often represented as an imminent or achieved destruction of privacy in which governments and businesses learn about our activities and desires using means that were unavailable in the pre-digital era (e.g., Andrews, 2012; Lanier, 2012; Mayer-Schönberger, 2011). As Jaron Lanier (2012) puts it (rather apocalyptically) in You Are Not A Gadget: “The deep meaning of personhood is being reduced by the illusions of bits. Since people will inexorably be connecting to one another through computers from here on out, we must find an alternative,” adding that we should try “to be a person instead of a source of fragments to be exploited by others” (p. 21). Lanier’s contrast between “deep” pre-digital selfhood and the supposedly diminished subjectivity manifested on digital networks is common to many articulations of this loss of control. One legal scholar refers to our off-line subjective state as “people’s pre-existing autonomy,” and the Enlightenment discourse of individual rights that such language evokes is the basis for the privacy rights that are being threatened (Pagallo, 2011; Griffin, 2008). Another, by contrast, refers to our online manifestations as “second selves” or “digital doppelgängers” (Andrews, 2012, p. 45), again insisting on the belatedness and inferiority of our online presence when compared to our “real” material selves. The response to this perceived crisis is to call for more privacy safeguards to be built into search engines, online financial transactions, and the uses of data about individuals by the entities with which we interact (e.g., Pentland, 2009; Froomkin, 2000). More “privacy by design” is needed because “[p]rivacy is not something that appear[s] naturally online, it must be deliberately architected” (Castelluccia, 2012, p. 31; see also Lessig, 2013; Witte, 2013). Theis is the Internet as a new world, one that resembles a 19th century “Darkest Africa” in that it is both magical and in obvious need of the European Enlightenment model of civilization. 
Like nearly all forms of digital exceptionalism, the claim that the crisis of online privacy is totally unprecedented overlooks a dense, complex history that conditions the various responses to our online readability – in this case, a history of making people “readable” via their clothes, behaviour, bodily characteristics, physical locations, language, et cetera – which has coexisted very easily with Modernity’s construction of the “private individual” and individual rights. It will be the work of this paper to recall this history of close reading and to analyze how its tropes are being replicated in digital environments. 
Whether legally or culturally enforced, attempts to regulate people’s behaviour and appearance have always been a feature of Western culture. From ancient Roman restrictions on conspicuous consumption (Dari-Mattiacci & Plisecka, 2012) to early modern sumptuary laws (Hunt, 1996; Killerby, 2002; Raffield, 2002) and from gendered clothing norms to racial profiling (Meehan & Ponder, 2002), people have always been read and/or judged by their appearance, and have always been conscious of these omnipresent interpretations of their identity. The extensive historicist body of scholarship on performativity has shown how consciously and publicly we perform our gendered, national, sexual, and professional identities (e.g., Butler, 2006; Dent & Whitehead, 2002; Ehlers, 2012; Negra, 2006). And, as Marjorie Garber (among many others) has pointed out, it makes many ordinary people (not just governments and other elites) nervous when the people around them cannot be read and normatively categorized via visual clues (Garber, 1997). However privacy is construed or justified, the idea that we could not be anonymously scrutinized, interpreted, and/or unfairly judged by others prior to the advent of the Internet is risible. The binary opposition between our “real” selves and our online identities outlined above is thus just a lazy unexamined assumption. The question is why theorists of the digital world (like Lanier and Andrews) so often think that they need it – what is driving the urge to bracket our online lives from our “private” lives when life in the West has always been a balance between external forces (seeking to know, circumscribe, and control how we behave) and individual or communitarian responses to these forces? 
This article argues that the anxiety about being closely read in networked environments is not a response to a new technological threat, but the articulation of a heretofore impossible desire: the desire to read the world around us without leaving traces or being read in return. As N. Katherine Hayles (among others) has argued, digital technology has radically extended and transformed the concept of what it means to read (Hayles, 2012). The desire to read anonymously, as it were, is a result of a failure to accept the full consequences of this change. It is fostered by our bodily experience of traversing the Internet – because we do not directly experience ourselves being read and interpolated in the ways that occur in any material public setting, we wrongly assume that we are not (and should not) be “seen” online. It is also encouraged by the marketing materials for our networked digital devices, which dwell on our capacity to access data and not on the extent to which we necessarily become nodes in other people’s networks by doing so (Rainie & Wellman, 2012). As strong as this desire may be, however, it is also impossible: it is oblivious of the ways in which being read is a fundamental price for living in communities (as discussed above); it is fundamentally inconsistent with the reciprocal character of networked data environments (Manovich, 2001); and it is an important reason why the online privacy debate has been unable to establish itself properly. Reading (whether one interprets texts, passersby in a street, or social practices) has always been a socially embedded and reciprocal act – this is why one can buy Harry Potter novels with “adult” covers and Fifty Shades of Grey novels with anodyne covers; someone may be watching and judging, even as we while away the bus ride to work. The acts of reading that we most resent when they are applied to us in digital knowledge environments (i.e., interpretations of our spending or communication habits) are the products of our participation in networked environments. We need to relearn how the legal presumption of privacy in no way arrests or displaces the kinds of sumptuary, performative, and/or judgmental readings that have always marked social life – even when that life is online.

US Practitioner Ideologies

'The Political Ideologies of American Lawyers' by Adam Bonica, Adam S. Chilton and Maya Sen in The Journal of Legal Analysis (Forthcoming) comments
 The ideology of American lawyers has been a persistent source of discussion and debate. Two obstacles, however, have prevented this topic from being systematically studied: the sheer number of attorneys in the United States and the need for a methodology that makes comparing the ideology of specific individuals possible. In this paper, we present a comprehensive mapping of lawyers’ ideologies that has overcome these hurdles. We use a new dataset that links the largest database of political ideology with the largest database of lawyers’ identities to complete the most extensive analysis of the political ideology of American lawyers ever conducted. 
Reflecting on the role of lawyers in the early American democracy, Alexis de Tocqueville famously wrote, “[i]n America there are no nobles or men of letters, and the people is apt to mistrust the wealthy; lawyers consequently form the highest political class, and the most cultivated circle of society” (de Tocqueville 1840, 514). Noting their political influence, he further observed that, “[i]f I were asked where I place the American aristocracy, I should reply without hesitation that it is not composed of the rich, who are united together by no common tie, but that it occupies the judicial bench and the bar.” 
Nearly two centuries later, de Tocqueville’s observations have largely remained accurate (Posner 2009). In the 113th Congress, 156 of the 435 members of the House of Representatives and 55 out of the 100 Senators elected were lawyers (Manning 2014). Moreover, 25 out of 43 Presidents have been lawyers (Slater 2008). Turning to state executive positions, 24 out of the current 50 state governors have law degrees. In addition being heavily overrepresented in elected branches of government, lawyers have the privilege of exclusively occupying an entire branch of government. All state high court justices are former lawyers, and 32 states explicitly require that their high court justices be former lawyers (Barton 2014, 30). All judges currently serving on the federal courts are lawyers, as are all nine justices sitting on the Supreme Court. 
The influence of the nation’s bar extends from elected politics into policy making and beyond. For example, by some counts, 8 percent of the nation’s lawyers work in government (American Bar Association 2012). Lawyers are also heavily overrepresented among Fortune 500 CEOs and CFOs (Wecker 2012). Within academia, law schools occupy the “crown jewel” positions at universities such as Harvard, Yale, Berkeley, and UCLA, with large law faculty and revenue generating streams (Winterhalter 2013). 
Moreover, the American Bar Association has nearly 400,000 members, making it one of the largest advocacy organizations in the country—behind only the American Association for the Advancement of Science in terms of total number of members (American Bar Association 2015). The ABA is also one of the largest and most powerful lobbying groups in the United States. 
Given the importance of lawyers in American public life, the ideologies of lawyers is a constant a source of discussion and debate among both academics and journalists. For example, commentators often discuss whether law firms are liberal or conservative based on the reputations of a few prominent partners, or—in the most comprehensive analysis prior to this study of the ideology of law firms—based on donations to two candidates in a single election (Muller 2013). Similarly, the ideologies of law schools have been examined using proxies like the breakdown of judges that law students clerk for after graduation (Roeder 2014). As these examples illustrate, the evidence used to study the ideology of American lawyers has mostly been anecdotal or incomplete, and systematic scholarship has remained elusive. These analyses have remained limited for two reasons. The first reason is that, given the massive number of attorneys in the United States, any study of the legal profession as a whole is a daunting task. With more than 1.1 million law school graduates in America (Brown 2013), conducting a compressive analysis of even simple data—addresses, law school attended, practice area, etc.—has been beyond the reach of even sophisticated quantitative scholars. The second reason is methodological: a systematic analysis of the legal profession requires developing a way to place individuals on a single, easily comparable ideological dimension. 
We address both of these issues by relying on a new dataset that links the most comprehensive database of political ideology with the most comprehensive database of lawyers’ identities. Our data on ideological leanings is from the Database on Ideology, Money in Politics, and Elections (DIME). The DIME data leverages the vast number of federal campaign contributions made by individuals. By scaling not just whom the contributions were made to, but also by what amount, the DIME data can be used to assess an individual’s ideological leaning. Our data on the identity of American lawyers is from the Martindale-Hubbell Legal Directory. Martindale-Hubbell provides the “most comprehensive database of lawyers in the country.” By linking the DIME data with the Martindale-Hubbell Legal Directory, we therefore have access to the largest and most comprehensive dataset ever amassed on the ideological leanings of the legal profession. 
We use this combined data to explore the ideology of American lawyers in five ways. First, we tackle the question of the ideological leanings of the legal profession taken as a whole. Second, we consider the relationship between geography and the ideology of lawyers. Third, we examine the relationship between lawyers’ educational backgrounds and ideology. Fourth, we explore how ideology varies across firms and within firms. Fifth, we look at the ideologies of lawyers by practice area. 
We proceed in this article as follows. In PART I, we motivate our inquiry by expanding on our observations about the importance of the bar and by discussing existing studies that examine its ideological positioning. PART II begins the discussion of the two datasets that we use in the analysis, which are (1) the DIME database of campaign contributions for ideological data and (2) the Martindale-Hubbell legal directory. This section is more technical and explains how the two databases were linked with each other, as well as possible sources of bias. In PART III, we present our basic findings regarding the overall ideological distribution of attorneys. In the following sections, we disaggregate the legal profession further. PART IV disaggregates the ideology of lawyers by their geographic location. PART V analyzes the distribution of lawyers’ ideology by their educational experience. PART VI presents the ideology of lawyers by the law firms where they work. PART VII explores the ideology of lawyers by their practice area.

09 September 2015

Intoxication and criminalisation

'Public Intoxication in NSW: The Contours of Criminalisation' by Luke McNamara and Julia Quilter in (2015) 37 Sydney Law Review traces
the history of the regulation of public intoxication in New South Wales (NSW) from the early 1800s to the present. We argue that although the formal legal status of public drunkenness and drinking has changed over time, and although different approaches have been prominent at different points in the history of NSW, public intoxication has been consistently and continuously criminalised for almost two centuries, despite official ‘decriminalisation’ in 1979. Shifts in regulatory modalities — including offence definitions, police powers, the involvement of local councils and enforcement practices — have been associated with significant changes in how the nature of the problem of public intoxication is conceived and how the persona of the ‘public drunk’ is constructed. Perceived at different times as immoral, annoying and pitiable, most recently, individuals who are intoxicated in public are increasingly seen as ‘dangerous’ and as posing a risk to other members of the community. The threat to public safety and the fear that innocent members of the public might be subjected to random violence have become major drivers of policymaking and law reform in this area, and have produced a less forgiving and more punitive approach to public intoxication. 
McNamara and Julia Quilter comment
In recent years, the problem of ‘alcohol-fuelled violence’ has been the subject of intense media scrutiny, and the trigger for a number of significant changes to New South Wales (NSW) criminal laws and liquor licensing laws. Much of the attention has focused on the dangers posed by young men who, while drunk in public, engage in random attacks, sometimes with fatal consequences. In this article, we locate these contemporary debates and legal developments in the broader context of the history of the criminalisation of public intoxication in NSW. A historicised approach reminds us that although there is a tendency to regard current risks, anxieties and regulatory urges about public intoxication as unprecedented, this is not the case. Public drunkenness and associated disorder has been a preoccupation of governments since the early days of the NSW colony. While constant, the preoccupation has not been static. 
This article tracks, from the 19th century to the present, the ways in which drunkenness and drinking in public places have been regulated in NSW. We show that the criminalisation of public intoxication in NSW has taken a multiplicity of forms over time. It has included the creation of various criminal and regulatory offences and police powers, and different enforcement practices heavily influenced by local exercises of discretion. Shifts over time have been associated with important changes in how the nature of the problem of public intoxication is conceived and how the persona of the ‘public drunk’ is constructed. As a case study of criminalisation as a tool of public policy, the history of the regulation of public intoxication in NSW offers a powerful illustration that how a problem is framed is an important driver of the choice of policy and legal responses. As Althaus, Bridgman and Davis observe, ‘[t]he importance of narratives in political discourse should not be underestimated’. Equally, the construction of regulatory subjects (‘public drunks’) is an important dimension of knowledge formation about law’s parameters and legitimacy. 
At intervals (often overlapping), the problem of public drunkenness has been variously characterised as one of inherent criminality, morality, race (specifically, Aboriginality), class, drug-dependence, welfare, risk and danger. We argue that these frames have influenced the shape of criminalisation in this area, but that the fact of criminalisation has been continuous, even during periods of official ‘decriminalisation’. Without underestimating the symbolic importance of moments when crimes are removed from the statute books, we argue that it is necessary to examine critically the consequences of such moves, including the nature and effect of regulatory techniques that are deployed to fill the ‘void’ left by decriminalisation. 
This paradox can be explained in at least three ways. First, there is a disconnect between the law on the books and the law in practice, including departures that result from pragmatic operational (mis)understandings of the law. Second, even as the formal status of public intoxication has shifted from criminalisation to decriminalisation to forms of re-criminalisation, police have consistently been vested with the power to intervene and remove intoxicated persons from public spaces. Third, a key part of the story of the ‘evolution’ of the State’s regulation of public intoxication is the hybridity of the criminalisation, blending substantive offences and coercive police powers. One of the consequences of the growth of coercive police powers, in preference to substantive offences, is reduced opportunities for targeted individuals to contest the legitimacy of police intervention in relation to their presence and behaviour in public. This phenomenon is not unique to public intoxication and applies to a range of antisocial and other behaviours considered unacceptable in public places. In addition to warranting attention in its own right, the history of the treatment of public drinking and public drunkenness by the criminal law and the police since the 19th century provides a good vehicle for demonstrating the nature and virtue of a wider agenda for grounded and contextualised criminalisation research, of the sort advocated by leading criminal law scholars, including for the purpose of grounding and interrogating normative judgments about overcriminalisation. As Lacey has explained:
The normative task of criminalisation theory can only be satisfactorily pursued if we also interest ourselves in some fundamental explanatory questions about the nature of criminalization over time and space. For the possibility of achieving valued goals or ideals can only be assessed by constructing a clear picture of the various institutional, political and social dynamics which underpin the constitution of criminal law at particular times and in particular places.
Such an approach necessarily involves deploying a ‘thick’ and broad conception of criminalisation. This approach does not begin and end with an examination of whether the conduct in question is a criminal offence or not. Rather, it takes account of what Lacey has promoted as ‘three complementary perspectives’ for criminalisation case studies: doctrinal structure, scope and logic; scope and pattern of enforcement; and legislative, social and political genealogy. 
Criminalisation is a rich and complex phenomenon that can manifest in any one or more of a number of methods of being on the receiving end of the coercive power of the state’s criminal justice institutions and agencies. Arrest, charge, conviction and court-issued punishment might still be widely seen as the paradigm of criminalisation, but we would argue that these processes may be only part of the story of criminalisation in any given context. This is especially so in the context of public order — where, for example, the line between the enforcement of substantive criminal offences and the deployment of coercive police powers is very much blurred, and where offence/power hybridity is also associated with the extension to the police of broad and rarely reviewed discretion to decide when and how to intervene. In particular, the field of public intoxication regulation demands, and illuminates the value of, the deployment of a thick conception of criminalisation. We will show that there has been considerable regulatory ebb and flow over time, in terms of both ‘law on the books’ (creation, abolition and re-creation of offences) and operation (including the enumeration and expansion of police powers that facilitate criminal intervention without charge or prosecution), and these shifts have been associated with evolving conceptions of the nature of the problem that warrants intervention. 
Two further introductory remarks are appropriate, to locate this article within broader questions about social, political and legal responses to alcohol consumption. First, the subject of this article reflects a consistent theme in policy and lawmaking in relation to alcohol: a preoccupation with public drinking and a tendency to treat the negative effects of intoxication that occur in public as more deserving of the state’s attention than behaviour that occurs in private. Although beyond the scope of this article, this unevenness deserves acknowledgment and warrants further research. For example, the effect is that people who drink in public — often a product of socioeconomic status and/or cultural preference — are exposed to higher levels of scrutiny and criminalisation than those who have, and prefer, the option of consuming alcohol in private. The most recent phase of the history of public intoxication regulation, where there has been a heavy focus on the risk of violence associated with public intoxication (rather than mere nuisance or loss of urban amenity), also brings the gender implications of this public/private unevenness into focus. It is striking — and, we would argue, problematic — that the risk of violence associated with private intoxication has largely been ignored in recent policy debates about ‘alcohol-fuelled violence’. Our concern is not simply that a focus on public alcohol-related violence involves an incomplete response to the evidence that alcohol consumption is associated with elevated risks of violence, but that this involves a heavily gendered approach by occluding the context in which women are more likely to be victimised by an alcohol or drug-affected person: in a private or domestic setting. 
Our final introductory remark is that the history of public intoxication and drinking in NSW (and elsewhere in Australia) is intimately connected with the history of the criminalisation and policing of Indigenous persons and communities. The particularities of this history (such as the creation of ‘dry’ communities and the Intervention/‘Stronger Futures’ regimes in the Northern Territory), require detailed and localised analysis. However, it is appropriate to acknowledge that many of the regulatory measures reviewed in this article — including ostensibly ‘welfare’-based decriminalisation mechanisms — have had, and continue to have, a disproportionately coercive and punitive impact on Aboriginal people in NSW. A disturbingly familiar pattern was revealed in the NSW Ombudsman’s 2014 report on the first year of operation of the offence of continuing to be intoxicated and disorderly in public after having been given a ‘move-on’ direction (introduced in 2011). The Ombudsman found that 30% of the ‘on-the-spot’ fines and 37% of the charges for this offence involved an Aboriginal person. 
Our discussion will start in Part II with a brief overview of 19th century public order-based approaches to the criminalisation of street drunkenness, which exhibited a strong focus on the public ‘drunk’ as unworthy, and a blight on the streetscape, synonymous with vagrants and beggars, as well as morally suspect working class drinkers. We also consider the way in which the summary offence of public drunkenness was deployed, particularly in the second half of the 20th century, not so much as a crime to be condemned and punished, but as a mechanism for police removal of drunks from public places, with relatively little appetite for formal prosecution and court-imposed sentences. Part III examines the move, during the 1970s and 1980s, towards the ‘decriminalisation’ of public drunkenness, ostensibly motivated by a welfare-based policy agenda that aimed to extricate chronic alcoholics (‘skid-row drunks’) from the criminal justice system, which was ill-suited to meeting their needs. Our analysis of this phase highlights the importance of a sophisticated conception of criminalisation as a regulatory tool that looks beneath the presence/absence of a specific criminal offence to consider the range of ways in which a person may come into contact with the criminal justice system. Although, with the passage of the Intoxicated Persons Act 1979 (NSW), conduct that was criminal one day became ‘legal’ the next, persons who were drunk in public still found themselves the subject of police scrutiny and well within reach of the power of the police to ‘apprehend’ and ‘detain’ (albeit without charge) by virtue of their drunkenness, or to be charged with other public order crimes to which intoxication was a significant causal contributor (such as offensive conduct or offensive language in a public place). 
Part IV charts the rise of local government/police partnerships to prohibit drinking in designated public areas from the 1990s, originally designed to empower both police officers and local council officers to give warnings and, where deemed necessary, to enforce ‘on-the-spot’ fines for minor regulatory offences under local government legislation, and later focused exclusively on the power to confiscate alcohol from persons drinking in a public place that had been declared ‘alcohol-free’. Part V considers the late 2000s adaptation of generic public order move-on powers introduced in the late 1990s into targeted move-on powers that allow the police to direct intoxicated individuals to move-on where their presence in a public place is considered to warrant dispersal, the augmentation of these powers with a specific offence of continued intoxicated and disorderly behaviour in 2011, and the introduction of ‘sobering up’ centres in 2013. 
If the policy emphasis in the decriminalisation era of the 1980s and 1990s was, at least ostensibly, to destigmatise public intoxication and ‘care’ for drunks in need, the measures adopted during the last two decades have had a very different focus, exhibiting a much stronger emphasis on condemnation of public drinking and drunkenness and an approach that conceives of public drunks as antisocial, dangerous and a risk to public safety.  Most recently, the correlation between public intoxication and violence has been a major driver of shifts in the contours of criminalisation. For example, in 2014, the NSW Parliament introduced a new offence of assault causing death while intoxicated, which attracts a mandatory minimum sentence of eight years’ imprisonment. 
We conclude that public intoxication has been consistently criminalised from the early colonial period to the present. Although the shape and prevailing mechanisms of criminalisation have changed over time, there has never been a period when public intoxication has been tolerated, or when the police have not had significant tools at their disposal to remove drunks from public places.

Employment as Identity

'Employment as a Legal Concept' (Temple University Legal Studies Research Paper No. 2015-33) by Brishen Rogers comments
 The employment status of workers for “sharing economy” firms such as Uber, Lyft, TaskRabbit and Handy is becoming a major legal and political issue. This essay takes up that question, building on the ongoing cases against Uber and Lyft. Against most commentators, it first argues that the ambiguous legal status of Uber and Lyft drivers is not a symptom of outdated legal tests. Rather, that ambiguity reflects a deeper conceptual problem: that our laws lack a satisfactory definition of employment in the first place. The solution to that problem, the essay argues, lies in recognizing employment as a legal concept through and through, and thus recognizing that questions of employment status inevitably involve contestable value judgments. The Uber and Lyft cases, for example, present a conflict between two important sets of social goods: on the one hand, distributive justice and a more egalitarian political economy; on the other hand, the substantial welfare benefits promised by the companies’ innovations. While reasonable people will disagree, the essay argues that imposing employment duties would strike an appropriate balance between these goals — ensuring that the benefits of disruptive technologies are fairly shared with those whose labor makes those technologies profitable.

08 September 2015

Inferentialist and other Pragmatisms

'Inferentialist Pragmatism and Dworkin’s ‘Law as Integrity' by Thiago Lopes Decat in (2015) 8(1) Erasmus Law Review aims -
at justifying an interpretation of Dworkin’s theory of Law as Integrity that brings it closer to philosophical pragmatism despite his rejection of legal pragmatism. In order to achieve this aim, this work employs a classification of philosophical commitments that define pragmatism in a broad and in a narrow sense and shows that legal pragmatism follows the main thinkers of pragmatism in the narrow sense in committing to instrumentalism. The attribution of a pragmatist character to Dworkin’s theory of law rests on the idea that the adoption of a commitment to instrumentalism is not implicated by its adoption of other pragmatist commitments. 
 Decat comments
 The widely known and historical polysemy of the term ‘pragmatism’, in its philosophical theoretical use, finds a match in its use in the theory of law. Nevertheless, a conception in particular has been standing out and getting more space in discussions in the legal field, namely the one involved in the debates between Ronald Dworkin and self-titled pragmatist Richard Posner. Such a conception of decisionist nature seems to claim as its remote antecedent two tenets of Oliver Wendell Holmes’) philosophy of law: the rejection of abstract speculation, especially moral ones, as well as the conscious decision to refer the contents of judicial decisions to its predictable social consequences. Its present-day antecedent may be found in Richard Rorty’s version of pragmatism that sees anti-theoretical and anti-systematic commitments as necessary consequences of conferring primacy to practice (in the sense of social practices) and of anti-essentialist thought. 
In an article called ‘The banality of pragmatism and the poetry of justice’, Rorty predictably restates the affinity between his version of neo-pragmatism and Posner’s philosophy of law. However, he surprises us by also enlisting Dworkin into the ranks of the legal (neo) pragmatism, despite his explicit rejection of what he conceives as legal pragmatism. This paper intends to make a similar move bringing Dworkin closer to a non-rortyan version of contemporary philosophical pragmatism. The argument rests on the idea that Robert Brandom’s inferencialist reading of pragmatist theoretical commitments can serve as the basis for a conception of contemporary philosophical pragmatism which is, simultaneously, anti-essentialist and based on the primacy of practical, without being for this reason anti-theoretical and anti-systematic. 
The reasonableness of this effort to bring them closer is justified, among other things, by the similarity between what Brandom calls historical-expressive rationality – a conception of rationality originally Hegelian but properly stripped of its metaphysical and teleological features by means of the resources of an inferencialist linguistic pragmatics – and the Dworkian demand for integrity that guides the decisions of judges as an independent ideal, according to an interpretation of legal social practices that shows them in their best light. The affinity between philosophical pragmatism and a rationalist, cognitivist, theory of law such as ‘Law as Integrity’ might perhaps allow the extension of the expression ‘legal pragmatism’ even beyond its already wide and vague limits.
'Pragmatism, Holism, and the Concept of Law' by Adam Dyrda in the same issue of the Erasmus Law Review comments
When discussing O. W. Holmes’s answer to the question ‘What constitutes the law?’ Morton White underlines the fact that Holmes’s inquiry didn’t focus on developing the concept of law. White states: ‘…Holmes said little in ‘The Path of the Law’ about the notion of legal authority, perhaps because he was interested not in what he called a “useless quintessence of all legal systems” but in “an accurate anatomy of one”’. Such ambition (or lack of ambition) is characteristic of many pragmatic enterprises in the field of jurisprudence. However, sometimes the opposition between legal pragmatism and other legal theories is built upon a reference to the notion of the ‘nature’ or ‘essence’ of law. Many legal philosophers who aim to reveal the very ‘nature of law’ (or ‘the concept of law’ as H. L. A. Hart did) try to interpret Holmes and other pragmatists as offering a competitive view to their own. I will follow White’s early intuition that such a construal of the controversy is simply wrong. Afterwards I will sketch a portrait of legal pragmatism in the context of White’s own inquiry and his version of ‘holistic pragmatism’; thirdly, I will present in brief the main reasons for exploring the concept of law in the contemporary analytic philosophy of law. Then I will show that traditionally ‘pragmatic’ and ‘analytic’ efforts in legal theory are situated on different levels of generality and conceptuality. However, these efforts can be, at least to some extent, reordered under the aegis of holistic pragmatism.

Financial Crime Report

The Parliamentary Joint Committee on Law Enforcement's Financial Crime report features the following recommendations, with - unsurprisingly - ongoing creep of warrantless access to telecommunimetadata -
R 1  The committee recommends that the government review the operations and outcomes of each law enforcement taskforce approximately 12 months prior to its conclusion in order to determine whether it should be made an ongoing taskforce. 
R 2  The committee recommends that the government introduce amendments to the Crimes (Currency) Act 1981 to give the RBA administrative responsibilities and the AFP law enforcement responsibilities with respect to counterfeit note collections and investigations. 
R 3  The committee recommends that subject to appropriate safeguards including adequate privacy and oversight arrangements, the government designate the ATO as a 'criminal law-enforcement agency' under the Telecommunications (Interception and Access) Act 1979, for the purpose of protecting public finances from serious criminal activities such as major tax fraud. 
R 4  The committee recommends the Government consider the extension of the AML/CTF regulations to cover 'second tier' professions in the current Anti‑Money Laundering and Counter-Terrorism Financing Act 2006 review. 
R 5  The committee recommends the government introduce amendments to the Australian Crime Commission Act 2002 to enable AUSTRAC to become a full member of the ACC Board. 
R 6  The committee recommends that the government review the penalties prescribed under financial services legislation administered by ASIC, with a view to achieving a better balance between non-compliance by licensed operators and unlicensed operations. 
R 7   The committee recommends that ASIC consider and then implement mechanisms to make its response to internet-based financial related crimes far more expeditious. 
R 8  The committee recommends that the Australian National Audit Office conduct a performance audit of ASIC's technological capacity, and provide a report to the Parliament outlining ASIC's technological requirements and capabilities, and the extent to which any deficiencies may hamper ASIC's regulatory responsibilities. 
R 9  The committee recommends that ASIC strive to improve its relationships with the private sector in order to better detect and deter financial related crimes. 
R 10   The committee recommends that AUSTRAC consider and then implement mechanisms to increase its regulatory oversight of the activities of unregistered remitters. 
R 11   The committee recommends the Attorney-General's Department review the arrangements for victims of identity crime to obtain a Commonwealth victim certificate. 
R 12  The committee recommends that financial institutions which issue debit and credit cards create an 'opt in' function that requires customers to consent to contactless payment technology features being activated on their cards. Recommendation 
R 13   The committee recommends the government fund targeted financial literacy education programs for Indigenous communities. These programs must be translated into local Indigenous languages, be specific to the local community circumstances and be delivered in a culturally appropriate manner. 
R 14  The committee recommends the government implement the recommendations from the National Indigenous Intelligence Task Force report relating to the prevention of financial crime and improved governance in Indigenous organisations.

Senate Digital Currencies Report

Last month's Senate Economics References Committee report Digital Currency—game changer or bit player examines "how best to define digital currency within the regulatory frameworks in order to support innovation and the needs of the growing Australian digital currency industry".

The Committee was asked
(a) how to develop an effective regulatory system for digital currency that: (i) ascertains the most appropriate definition of digital currencies under Australian tax law, (ii) promotes competition and growth of the digital currency industry, (iii) ensures ongoing stability in the financial services industry, (iv) secures protection of consumers and businesses against illegal activity, (v) incorporates digital currencies into Australia's national security framework, and (vi) ensures the financial stability of the industry; 
(b) the potential impact of digital currency technology on the Australian economy, including the: (i) payments sector, (ii) retail sector, and (iii) banking sector; 
(c) how Australia can take advantage of digital currency technology to establish itself as a market leader in this field; and 
(d) any other related matters. 
The report comprises six chapters -
 chapter 2—provides an overview of digital currencies and recent developments both in Australia and overseas; 
chapter 3—discusses some of the potential risks and benefits of digital currencies; 
chapter 4—examines the tax treatment of digital currencies; 
chapter 5—looks at how digital currencies fit within the financial and payments system regulatory frameworks; and 
chapter 6—considers whether digital currencies should be brought within the anti-money laundering and counter terrorism regime. 
In Chapter 5 the report states -
The committee acknowledges the need for a clear regulatory approach for both consumers and the digital currency industry. The committee considered concerns raised by submitters about the negative effect overregulation would have at this early stage in the development of the industry. In this respect, the central concern was any regulatory framework should balance the need to mitigate risks facing consumers and the broader financial system, while still encouraging innovation and growth in the industry by keeping the barriers to entry low. As the digital currency industry is still in its early stages, the committee supports a 'wait-and-see' approach to government regulation. The committee believes that the relevant government agencies should closely monitor the development of the digital currency industry in Australia, and conduct further research to determine the actual risks and opportunities presented by different types of digital currency businesses, for example Bitcoin exchanges and ATMs, or payment facilities. The committee supports ADCCA's continued development of industry best practices based on the standards set for financial services and payments services. This self-regulation model should be developed in consultation with government agencies, as well relevant stakeholders in the banking, finance and payments sectors. The committee considers that this will ensure that businesses are prepared for regulatory oversight in the future, as the industry expands and grows. 
The Committee's comment in relation to Chapter 6 is -
In order to help manage relationships with banking services and be prepared for future regulation, some digital currency businesses have tried to mirror the obligations that are required by designated services under the AML/CTF regime, such as implementing know your customer programs. However, the AML/CTF Act currently does not cover digital currencies that are not backed by precious metal or bullion. Consequently, digital currency businesses are not able to access the Document Verification Service which would better facilitate identity checking to meet AML/CTF requirements. Furthermore, they currently stand outside this robust regulatory regime designed to detect and deter money laundering and terrorism financing. 
The committee strongly supports applying AML/CTF regulation to digital currency exchanges, noting that similar steps have been taken in Canada, the UK and Singapore. The committee notes that the Attorney-General's Department is currently conducting a statutory review of the AML/CTF Act which is examining whether digital currency businesses should be brought under the AML/CTF regime, and if so which businesses should be included. 
 Overall the Committee's recommendations are anodyne -
R1 The committee is of the view that digital currency should be treated as money for the purposes of the goods and services tax. As such, the committee recommends that the government consults with the states and territories to consider amending the definition of money in the A New Tax System (Goods and Services Tax) Act 1999 and including digital currency in the definition of financial supply in A New Tax System (Goods and Services Tax) Regulations 1999
R2 The committee recommends that further examination of appropriate tax treatment of digital currencies should be included in the taxation white paper process, with particular regard to income tax and fringe benefits tax. 
R3 The committee recommends that the Australian government consider establishing a Digital Economy Taskforce to gather further information on the uses, opportunities and risks associated with digital currencies. This will enable regulators, such as the Reserve Bank of Australia and ASIC, to monitor and determine if and when it may be appropriate to regulate certain digital currency businesses. In the meantime, the committee supports ADCCA's continued development of a self-regulation model, in consultation with government agencies. 
R4 The committee recommends that the statutory review considers applying AML/CTF regulations to digital currency exchanges.