Sites protest Spain's net law. (Up front: news, trends & analysis).

Spain is now regulating cyberspace sites that engage in commerce, and any organization doing business in or with the country should be aware of the new law.

Under a law that took effect October 12, 2002, any Spain-based Web site that participates in commerce must now register with the government. According to Kriptopolis, a digital rights and Internet security site, the tough new rules have prompted at least 300 Web site owners to take their pages offline in protest. Many site operators say their protest is temporary, but others say they have signed off for good. Still others say the law is so difficult to decipher that they don't know how to comply. Many are small, not-for-profit operators, including one that was offering free articles on ancient Egypt.

The government says the law stems from European Union (EU) directives and aims to encourage online commerce by making the Internet a safer place to do business. It wants companies operating on the Internet to be subject to the same tax and commerce laws as traditional firms. In addition to requiring Web sites that carry out commercial transactions to sign up with the government, the law also mandates that they display their company address and phone number to give customers a physical place to turn if problems arise. But critics say Spain has gone beyond the spirit of the EU guidelines by trying to regulate cyberspace.

The law would also apply to foreign-hosted Web sites if the people transacting business on them are physically in Spain. Even not-for-profit sites that take in revenue--from advertising banners, for example--are considered to be doing business, even if operating at a loss. And while such sites do not have to register, the government says they do have to publish the webmaster's name, address, and national identification number.

Other provisions of the law oblige Internet access providers and Web sites to store customers' "connection and traffic data" for up to one year. But the law doesn't specify whether this entails just IP addresses--individual computers' fingerprints--or other, more detailed, information. The statute goes further by stating that if Spanish authorities deem something on a foreign-hosted Web site to be threatening to the country's national defense, public order, consumer rights, or other values, they can order Spanish operators to sever access to that site. Many experts say that clause puts Spain in the same category of strict content control as Saudi Arabia and China.

Fines for violating the law can be as steep as 600,000 euros ($590,000 U.S.), although none have been reported so far. Still, many fear the repercussions will be more costly: the law may discourage people from creating new and continuing to operate existing Web sites.