The Federal Communication Commission (FCC) has made new Net neutrality rules official, placing restrictions on broadband providers from favouring or discriminating against traffic that travels through their networks.

The new regulations allow the FCC to punish broadband providers which slow down service or restrict content for customers. The new rules will go into effect on 20 November.

In its report, Preserving the Open Internet, the FCC said that it had initiated a public process to determine whether and what actions might be necessary "to preserve the characteristics that have allowed the Internet to grow into an indispensable platform supporting our nation’s economy and civic life, and to foster continued investment in the physical networks that enable the Internet."

The FCC said the process has made clear that the Internet has thrived because of its freedom and openness, adding that such openness cannot be taken for granted.

"The record and our economic analysis demonstrate, however, that the openness of the Internet cannot be taken for granted, and that it faces real threats," said the FCC.

It added, "Indeed, we have seen broadband providers endanger the Internet’s openness by blocking or degrading content and applications without disclosing their practices to end users and edge providers, notwithstanding the Commission’s adoption of open Internet principles in 2005."

The Commission has laid out three basic protections. First, fixed and mobile broadband providers must disclose the network management practices, performance characteristics and commercial terms of their broadband services. Second, fixed broadband providers may not block lawful content, applications, services, or non-harmful devices; mobile broadband providers may not block lawful websites, or block applications that compete with their voice or video telephony services. And finally, fixed broadband providers may not unreasonably discriminate in transmitting lawful network traffic.

The FCC said, "We believe these rules, applied with the complementary principle of reasonable network management, will empower and protect consumers and innovators while helping ensure that the Internet continues to flourish, with robust private investment and rapid innovation at both the core and the edge of the network.

"This is consistent with the National Broadband Plan goal of broadband access that is ubiquitous and fast, promoting the global competitiveness of the United States."

However, the new laws are expected to be opposed by service providers such as Verizon and MetroPCS. Some ISPs believe that the marketplace should be allowed to decide the services they provide to customers based on the revenue the services generate.

Recently, the Netherlands announced that it would be the first European country to regulate Net neutrality. However, other European member states such as the UK and France are still in the process of arriving at a consensus on Net neutrality, despite the efforts of European Digital Agenda Commissioner Neelie Kroes to legislate against Internet providers who support a two-tier model.

In the UK, net neutrality campaigners have raised concerns that without stricter rules, ISPs may begin charging for unrestricted access to consumers and create a "two-tiered" Internet and thereby harm small businesses.

Meanwhile, ISPs argue that traffic management is key to maintaining a quality service. British ISPs have defended a two-tier Internet model at a ministerial summit on net neutrality chaired by communications minister Ed Vaizey. ISPs – BT, Sky and Virgin Media – called for prioritising some traffic on their networks and block some. But the move could make some services out of reach for many users.

In April, Kroes published an EU report on net neutrality which says that the EU will investigate whether ISPs are providing fair access to online services.

Kroes had said, "At the end of 2011, I will publish the results, including any instances of blocking or throttling certain types of traffic. If I am not satisfied, I will not hesitate to come up with more stringent measures, which may take the form of guidance or even general legislative measures to achieve the competition and choice consumers deserve."