The European Commission ruled that service providers will not have to act as Internet content censors.

The EC rejected amendments put forward in May, to be introduced into the European Parliament's ecommerce directive, to increase the legal liability of ISPs.

It said the original proposals - which makes an ISP responsible for site content only if it's been given notification of offending or defamatory material - went far enough and increasing the liability would hinder ecommerce development in Europe.

However, the ISP industry is still not in the clear. The directive is yet to go before the council of ministers and member states, which could reverse the commission's decision.

The council of ministers is expected to come to a final agreement before the end of the year. However, due to the complexities within the electronic commerce directive, industry observers believe it will be well into next year before a final draft, approved by all parties, can be drawn up.

On a side-note, in contrast to the Australian proposals, the Commission believes that central blacklisting of content by proxy servers is "inconceivable for Europe as it would severely interfere with the freedom of the individual and its political traditions."