In United States and European Union law, notice and takedown is mandated as part of limited liability, or safe harbour, provisions for online hosts (see the Digital Millennium Copyright Act 1998 and the Electronic Commerce Directive 2000).
[16] The Directive does not set out notice and takedown procedures but it envisaged the development of such a process because online hosts who fail to act expeditiously upon notification lose limited liability protection.
The Directive suggests that voluntary agreements between trade bodies and consumer associations could specify notice and takedown processes, and that such initiatives should be encouraged by member states.
The court stated that the company "should have expected offensive posts, and exercised an extra degree of caution so as to avoid being held liable for damage to an individual’s reputation" and its notice and take down comments moderation system was "insufficient for preventing harm being cause to third parties".
The Electronic Frontier Foundation, along with other civil society organisations published principles on user generated content, calling for the protection of legitimate use of copyright protected works, prior notification of the uploader before removal or the placement of ads on the content, use of the DMCA counter notice system, including reinstatement upon counter note and the failure of the copyright owner to bring a lawsuit.
Member states implemented diverging approaches on the duty to act expeditiously and on when an online host obtains "actual knowledge" in relation to notifications.
As a result, notice and takedown procedures are fragmented across EU member states and online hosts face considerable legal uncertainty.
The European Commission observed that "Online intermediaries face high compliance costs and legal uncertainty because they typically have operations across Europe, but the basic rules of Article 14 are interpreted in different ways by different national courts (sometimes even within the same member state)."
Proposals for notice and stay down rules have been made in the United States by pro-copyright lobbyists, and constitute Article 17 of the EU's Directive on Copyright in the Digital Single Market.
[33][35][36][34][37] The concept of notice and stay down has faced criticism; it has been noted that the only way to reliably enforce such an obligation would be through automatic filtering, which is subject to the possibility of false positives, and the inability to detect lawful uses of an affected work (such as fair use).
The Electronic Frontier Foundation argued that requiring proactive monitoring of user content would place the burden of copyright enforcement on service providers (thus defeating the purpose of safe harbors), and would be too costly for newly-established companies (thus bolstering incumbents and stifling innovation).
[32][33] The implementation of Article 17 adopted by the German parliament includes safe harbour provisions intended to prevent false positives in situations "presumably authorised by law" (such as fair dealing rights), including that filters should not be applied automatically if an upload's use of copyrighted material is "minor" (defined as 160 characters of text, 125 kilobytes of image data, or video clips up to 15 seconds), in combination with other content, and using less than 50% of the original work.