Piracy on the Internet
Internet piracy has become so popular that 70% of people claim they see nothing morally wrong with downloading illegal music and movies. Unfortunately, Internet piracy is not just a moral issue, but also a global economic and social epidemic. The more the Internet grows and expands, the more people are nonchalant about violating intellectual property rights. The purpose of copyright is to ensure that artists, producers, studios etc. will be able to claim their profits. If action is not taken against Internet piracy, our generation will be the last to enjoy music and other artistic productions because studios and companies will no longer be able to support themselves. People are less likely to invest, or buy creative works if that work can be copied and resold by third parties. Intellectual property is defined as “intangible property that is the result of creativity.” Luxembourg is very proactive with IP standards and participates in all the major IP meetings, and attends every IP treaties and conventions such as the Bern convention and the Patent Cooperation treaty. The IP- Internet nexus can be looked at from three perspectives-the author, the user and the services provider. An author created a piece of work and register it under the existing ip laws to enjoy certain benefits, but the digital world hinders the complete enjoyment of these rights. Copyright owners perceive Internet as a threat to their exclusive rights due to the following reason: (i) Wide distribution is relatively simpler and quicker on the internet; (ii) Anyone can distribute it to a mass audience; (iii) The quality of copies is virtually indistinguishable from the original; (iv) Distribution is almost costless and (v) Users can easily and cheaply obtain copyright on the internet. The Internet has become a gateway for the exploitation of other people’s intellectual property. File sharing and illegally downloading music and movies is a pressing issue that should be WIPO’s main focus. Companies all over the world are loosing millions every year because of Internet piracy, so legislation needs to be passed in order to compensate for their losses. The growth of the size and popularity of the Internet had an overwhelming effect on software piracy and it is regarded as possibly the fastest growing type of software piracy. The Internet faces the same laws and license agreements as physical software distribution; no differentiation is made between offline and online infringement in the Copyright Act.
Content
PIRACY ON THE INTERNET
Project report on Intellectual Property Rights-I
Submitted To:
Assistant Prof. Amrita Pinak
Submitted By:
Shivani Jaiswal
B.B.A.LL.B (Hons.) – VII Semester
MATS University
MATS Law School, Raipur
1
ACKNOWLEDGEMENT
I express my sincere gratitude to Asst. Prof. Amrita Pinak , MATS Law School, Raipur, and
owe my foremost regards to her for giving me an opportunity to carry out this project work under
herguidance. This work would not have been possible without her invaluable support and
thought provoking comments.
I would also like to thank my batch mates who directly or indirectly helped me in making
this project.
2
DECLARATION
I, Shivani Jaiswal, undersigned hereby declare that this research report on Piracy on the
Internet on Intellectual Property Rights compiled and submitted by me is an original work
conducted under the guidance of Asst. Prof. Amrita Pinak. It is a work done by me as a partial
fulfillment of the Bachelor’s degree in Competition Law. No part of this work will be published
or copied for any purpose.
Date:
Shivani Jaiswal
Place- Raipur
3
RESEARCH METHODOLOGY
The research methodology that I have adopted in this project is the “Doctrinal Research
Methodology” where the sources of the project are solely based upon the materials collected
from the websites and books. Certain other resources for our project are several Articles
collected from various journals and magazines as well as several other commentaries and digests
written and published by several eminent scholars who have excelled in various fields of the
managerial fraternity nationally and internationally.
4
INDEX
S.No.
Topic
Page No.
1
INTRODUCTION
6
2
SOFTWARE PIRACY
8
3
KINDS OF SOFTWAER PIRACY
11
4
PROTECTION UNDER INTERNATIONAL INSTRUMENTS AND
14
THE NATIONAL LAW
5
6
COPYRIGHT PIRACY: THE BACKGROUND
17
22
7
PRACTICAL SOLUTION TO SOFTWARE PIRACY
CONCLUSION
24
8
REFRENCES
25
5
INTRODUCTION
Internet piracy has become so popular that 70% of people claim they see nothing morally wrong
with downloading illegal music and movies.1 Unfortunately, Internet piracy is not just a moral
issue, but also a global economic and social epidemic. The more the Internet grows and expands,
the more people are nonchalant about violating intellectual property rights. 2 The purpose of
copyright is to ensure that artists, producers, studios etc. will be able to claim their profits. If
action is not taken against Internet piracy, our generation will be the last to enjoy music and other
artistic productions because studios and companies will no longer be able to support themselves.
People are less likely to invest, or buy creative works if that work can be copied and resold by
third parties.3 Intellectual property is defined as “intangible property that is the result of
creativity.”4 Luxembourg is very proactive with IP standards and participates in all the major IP
meetings, and attends every IP treaties and conventions such as the Bern convention and the
Patent Cooperation treaty.5
The IP- Internet nexus can be looked at from three perspectives-the author, the user and the
services provider. An author created a piece of work and register it under the existing ip laws to
enjoy certain benefits, but the digital world hinders the complete enjoyment of these rights.
Copyright owners perceive Internet as a threat to their exclusive rights due to the following
1 “Online Piracy in Numbers-Facts and Statistics (info graphic)”, 2012; http://www.gogulf.com/blog/online-piracy/
2 “Internet Software Piracy: A Multifaceted Challenge”, BSA 2011;http://internet.bsa.org/overview/home.aspx
3
Jum
Picht,
“The
Stop
Online
Piracy
Act:
A
Cure…”,
2012;http://communities.washingtontimes.com/neighborhood/stimulus/2012/jan/18/stoponlinepiracy-act-cure-worse-disease/
January
18
4 “Intellectual Property”, Audio English,http://www.audioenglish.net/dictionary/intellectual_property.htm
5 “Eight Annual BSA Global Software: 2010 Piracy Study”, Business SoftwareAlliance Global Offices, May 2011;
http://portal.bsa.org/globalpiracy2010/downloads/study_pdf/2010_BSA_Piracy_Stud
y-Standard.pdf
6
reason: (i) Wide distribution is relatively simpler and quicker on the internet; (ii) Anyone can
distribute it to a mass audience; (iii) The quality of copies is virtually indistinguishable from the
original; (iv) Distribution is almost costless and (v) Users can easily and cheaply obtain
copyright on the internet.6 The Internet has become a gateway for the exploitation of other
people’s intellectual property. File sharing and illegally downloading music and movies is a
pressing issue that should be WIPO’s main focus. Companies all over the world are loosing
millions every year because of Internet piracy, so legislation needs to be passed in order to
compensate for their losses.7
The growth of the size and popularity of the Internet had an overwhelming effect on software
piracy and it is regarded as possibly the fastest growing type of software piracy. The Internet
faces the same laws and license agreements as physical software distribution; no differentiation
is made between offline and online infringement in the Copyright Act.
6The impact of the internet on intellectual property law, WIPO Programs Activities,
http:/www.wipo.int/copyright/commerce (29 Novenmber 2012).
7 Nathan Douglas, “Online Piracy: Combatting Theft and Censorship in theInformation Age”, 2012;
https://www.ohiobar.org/NewsAndPublications/OhioLawyer/Pages/Online-piracyCombating-theft-and-censorship-in-the-Information-Age.aspx
7
SOFTWARE PIRACY
Software is defined as a set of instructions which when incorporated in a machine readable form
or in capable of causing a computer to perform a particular task. To put it simply, it is a series of
commands which can be understood by the machine. There are three essential types of software
which help to function the computer, micro code which is a programme which controls the
details of execution, the operating system software which controls the sources of a computer and
manages routine tasks and which is a necessary requirement for a computer to function;
application software which is designed to perform a particular task. Piracy occurs when
copyrighted software is made available to users to download without the express permission of
the copyright owner. Such illegal software is offered over online sources such as online
advertisements newsgroups bulletin board service and auction sites. Piracy hampers creativity,
hinders the development of new software and local software industry and ultimately effects ecommerce. Piracy harms consumers and has negative impact on local and national economy.
Consumers run the risk of viruses and having corrupted and defective programs.
According to Nasscom,8 software piracy involves the use, reproduction or distribution without
having received the expressed permission of the software author. Software piracy comes in four
common forms. The first is end user piracy, and it occurs when users of software install the
software on more machines than they are entitled to under their license agreements. The second
is hard disk loading, and it occurs when computer dealers install illegal copies of software onto
computers prior to their sale. The third is software counterfeiting, and it involves the illegal
reproduction, and subsequent sale of software in a form that is nearly identical to the original
product. The fourth is Internet piracy, and it occurs when individuals place unauthorized copies
of software on the Internet for download.
Punishment:
Under the Indian Copyright Act, a software pirate can be tried under both civil and criminal law.
The minimum jail term for software copyright infringement is seven days, and the maximum jail
term is three years. Statutory fines range from a minimum of 50,000 to a maximum of 200,000
rupees.
8 The National Association of Software and Service Companies
8
Five Myths about Software Copy Protection:
1. Software piracy is a victimless crime.
Nothing could be further from the truth. According to industry statistics, illegal software use
costs publishers worldwide nearly $48 billion a year in lost revenues, with more than $8 billion
lost in the North America alone. In Central and Eastern Europe, an average of 68% of the
software in use is illegal. In some Asian and Eastern European markets, over 88% of software is
unlicensed.
2. Software copy protection makes software more expensive.
On the contrary, the price publishers pay for software copy protection is negligible compared to
the losses they incur through the pirating of their software. In fact, the vast majority of cases
have shown that investment in protection is offset entirely by increased sales and profit. By
protecting their software and thereby increasing their revenues, publishers can afford to supply
better software at more competitive prices. True, not everyone who copies software today would
buy it tomorrow if it were available only in a protected format. But, the ensured quality, support
and functionality that comes with a manufacturer’s copy is generally well worth an incremental
fee.
3. Software copy protection gets in the way of the legitimate user.
The new, more sophisticated types of software copy protection in no way hinder legitimate endusers, but instead work to benefit them. One important reason for this is because protection
safeguards the integrity of the software; the end-user is assured that the software cannot be
tampered with in any way. Additionally, higher revenues for developers mean that down the line,
users will benefit from better, higher quality software. Large organizations are legally liable for
the software they purchase and have a clear interest in preventing the unauthorized distribution
of that software. Often, the users themselves request that the software be protected, to ensure that
it won’t be used illegally, thus preventing future litigation.
4. Inexpensive software is not copied.
9
Some people attack the concept of software protection by arguing: “Make software cheaper,
that’s all. People don’t copy inexpensive software, and you’ll sell more copies of your product.”
The argument is inherently false. People who are inclined to copy software will copy the
inexpensive as well as the expensive software programs. The same people that are saying, “if
software were cheaper we would buy it,” are copying software that costs as little as $10. The
reality is that developing a software product requires a substantial investment of time and money,
and most software publishers simply cannot afford to lower their prices.
5. Any protection system can be cracked. Therefore, software copy protection is useless.
Only the first part of this myth is true: any software protection system can be cracked, just as any
lock can be picked or any door can be broken. However, the aim of software copy protection is
to provide protection for a reasonable period of time. Software cannot be protected forever, but it
can definitely be protected long enough (i.e., until the next version of the software product is
released). This new software version should again be protected, with a strong and field-proven
protection technology that has also been improved in parallel, thus ensuring a long and profitable
sales life for the protected software application.
10
KINDS OF SOFTWAER PIRACY
Software piracy is unauthorized reproduction of copyrighted software. The unauthorized
copying can be done for different purposes such as personal use, business use and even selling
copies of the pirated software. Even though pirating copyrighted soft-ware is illegal, there are
still millions of computer users pirating copyrighted software in the world. The rates of software
piracy have been increased rapidly with the growing use of computers and this activity not only
affects the economy of software companies but also affects the loyal customers who actually
purchase their products as intended.9 Software piracy occurs in different forms. The most
common form as defined by Micro-soft is considered to be “End User Piracy”. It happens when
individuals and businesses make copies of software without a license to do so. People may copy
a program and give it to others without realizing that this is software piracy. Similarly, an
organization may install software on more computers than its licenses allow. SIIA (Software and
Information Industry Association) and BSA are non-profit trade associations established to
advance the goals of the software industry and its hardware partners. They have listed some
common types of software piracy on their websites.
1. Soft lifting
Soft lifting is the act of illegal copying of software and distributing it to friends, organizations or
duplication and resale in violation of the terms of the license agreement. Many personal users
and enterprises are doing it knowingly or unknowingly and only few of them care about it. Such
activities lead software industry to lose billions of dollars each year and shatter the profitability
of large software companies as well as small ones. It often happens when organizations expand
computer capabilities and install unauthorized copies, rather than going through the purchasing
procedure. Soft lifting is sometimes referred to End User Piracy as in both cases one copy of
software is purchased for a particular machine and later installed on several machines in
violation of its copyright law.
9Business Software Alliance. The Compliance Gap [online]. June 2014.
URL:http://globalstudy.bsa.org/2013/downloads/studies/2013GlobalSurvey_Study_en.pdf. Accessed 28
June 2014.
11
2. Internet piracy
Nowadays, Internet piracy is one of the fastest and easiest ways to receive pirated software.
There are several websites that make software available for free download in a number of ways.
Many computer users download software from the Internet, which makes their lives easy as they
do not even need to visit stores or sending out copies of software on a CD-ROM or floppy disk.
These techniques have made our lives easier but at the same time they have also increased
internet piracy, which occurs in different forms such as downloading or uploading of illegal
copies of software over the Internet.10
3. Hard-disk loading
Hard-disk loading occurs when an individual or company sells computers preloaded with illegal
copies of software into the hard disks to encourage the consumer to buy their products. Since this
kind of activity is common, SIIA recommends computer buyers to confirm with the vendors that
software preloaded on the machines are legal and licensed copies. If the vendor is unwilling to
supply with the proper documentation, SIIA highly recommends not dealing with that vendor.11
4.
Software counterfeiting
Software counterfeiting is illegal duplication and sale of copyrighted software in such a way that
it appears to be authentic. Counterfeit software includes accompanying manuals that the original
legitimate software was sold and is usually sold at prices well below that of the retail price of the
legitimate software. This is the most typical type of software piracy and different organizations
are actively participating in stopping this kind of activity. Though counterfeit software is cheap
and easily available but it is also risky to use, since it can bring malware along with it. According
to a study, “The dangerous world of counterfeit and pirated software” conducted by IDC in 2013,
10 Software & Information Industry Association. What is Piracy ? [online]. URL:
http://www.faithaca.org/SIIA.pdf. Accessed 28 June 2014.
11 Software & Information Industry Association. What is Piracy ? [online]. URL:
http://www.faithaca.org/SIIA.pdf. Accessed 28 June 2014.
12
the chances of infection of malware from counterfeit software are 1 in 8 for consumers and 1 in 9
for businesses.12
5. Unauthorized use of academic software
Many software companies sell academic versions of their software to public schools, universities
and other educational institutions. When the software is labelled to use for academic or
educational purposes only, it cannot be used for commercial or other for-profit purposes. Using
academic software for private use in violation of the software license is a form of software piracy
and it not only hurts the software publisher, but also the institution that was the intended
recipient of the software.
6.
Renting
Renting involves someone renting out a copy of licensed software for temporary pur-poses. In
such type of piracy, software is rented to individual computers and returned the original software
to the renter. This method of piracy is not as common as other forms of piracy due to its
distribution nature but it still does exist. It has always been illegal to rent unauthorized copies of
software. The “Computer Software Rental Amendments Act” formed in the US in 1990 strictly
prohibits the rental, lease or lend-ing of a computer program for direct or indirect commercial
gain unless authorized by the owner of the copyright in the program.13
12 Kallol Bagchi, Peeter Kris, and Eobert Cerveny. Global software piracy: Can eco-nomic factors alone
explain the trend ? Journal of Communication of the ACM 2006;49(6):70-75. Accessed 4 December
2014.
13 Report on computer software rental act [online]. United States copyright office; 14 January 2003.
URL:http://www.copyright.gov/reports/software_ren.html.Accessed 4 July 2014.
13
PROTECTION UNDER INTERNATIONAL INSTRUMENTS AND THE
NATIONAL LAW
1. Trade Related Aspects of Intellectual Property Rights (TRIPS):
This is the first international treaty to explicitly include computer programs within the illustrative
list of copyrighted works. TRIPS set forth three different forms of protection for software:
copyright, patent and trade secrets. TRIPS includes a specific provision in Article 10 that
expressly requires member states to protect software, whether in source or object code, as literary
works under the Berne Convention. However, the member countries have a right to provide more
extensive protection of intellectual property rights within their national legal systems.
Article 27.1 recognizes patent protection for software related invention for the member states so
long as the invention satisfies the other requirements (6) for patentability which are country
specific. Therefore, software may be granted patent protection in a particular country if it fulfils
the specific conditions set forth under the laws of that country. Article 39 of TRIPS provides an
alternative to copyright protection. It talks about protection for undisclosed information and
offers a trade secret regime for software protection. Trade secret regime is applicable for the
protection of trade secrets which may include software. A particular software may contain lot of
valuable and confidential information about a company which forms its trade secret. Civil and
criminal actions are provided for in most legislation against the unauthorized disclosure or use of
confidential information. In this case, there is no exclusive right, but an indirect type of
protection based on a factual characteristic of the information (its secret nature) and its business
value. Unlike patents, trade secrets are protected as long as the information is kept secret. Thus,
TRIPS does not preclude additional forms of protection for computer programs and a member
can offer patent, copyright and trade secret protection for computer programs. Keeping in mind
the higher standards of creativity required by patent law the software developer can choose any
form of protection which is most desirable to him. As the source code is comprehensible only by
a trained programmer and not by normal persons, the proprietors generally protect the source
code under the trade secret regime and the object code is protected as a copyright.
2. Berne Convention (BC):
14
The Berne Convention does not explicitly mention computer programs in its illustrative list of
copyright works. However, as per TRIPS, member states should recognize computer programs
(software) as literary works. Article 2 (7) of the Berne Convention makes the protection of works
of applied art dependent on domestic legislation i.e. the extent to which protection may be
granted and the conditions under which such works will be protected is dependent on the statute
of the particular country where the work originated. Works enumerated in Article 2 of the Berne
Convention are mere illustrations of the kinds of works to which copyright might extend. These
illustrations are not exhaustive. Therefore, works such as computer programs that exhibit
utilitarian characteristics and also contain expressive elements can be brought under the ambit of
work of applied art. However, Article 7 (4) of the Berne Convention exempts, inter alia, the
works of applied art from the general term of protection and sets up a minimum term of only 25
years from the making of the work. As article 2 (7) makes the protection of works of applied art
dependent on domestic legislations, the term of protection may be applicable accordingly with
respect to different countries.
3. Universal Copyright Convention (UCC):
Under the UCC’s national treatment provisions, software created by a U.S. author or first
published in the US is protected in other UCC member countries to the extent that the member
country’s copyright laws protect software. The UCC provides that any member country that
requires, as a condition of copyright protection, compliance with formalities (such as
registration, deposit or notice) must treat such formalities as satisfied if all published copies of a
work bear the symbol “©”, the name of the copyright proprietor and the year of first publication.
This provision applies, however, only to works that (i) were first published outside the country
requiring the observance of the formalities, and (ii) were not authored by one of that country’s
nationals. In contrast to Berne Convention, formalities such as registration are permitted under
the UCC in order to bring an infringement suit. India being a member to the UCC, authors of
software in US will get protection in India also as per the terms and conditions laid down in the
Indian copyright law.
4. World Intellectual Property Organization (WIPO):
15
In 1996, two copyright treaties were negotiated under the auspices of WIPO. These treaties are:
WIPO Copyright Treaty (WCT) and the WIPO Performances and Phonograms Treaty (WPPT).
The WCT of 1996 is a special agreement to the Berne Convention and requires compliance with
Berne Convention. This treaty makes explicit that computer programs are protected as literary
works under Berne Convention. It also states that compilations of data for which the selection or
arrangement of the contents are sufficiently original are protected as compilations.
16
COPYRIGHT PIRACY: THE BACKGROUND
The world today has entered into an era of instant communication. A person sitting in the
remotest corner of India can enjoy live performance taking place in the faraway places like
America or Africa, thanks to electronic (parallel) media. Telephone and fax have made it possible
to communicate oral or written messages across the globe within seconds. The computer-aided
communication technologies such as E-Mail and Internet have added altogether a new dimension
to today's communication process by making it more speedy, informative and economical. The
ways through which different types of information can be communicated have also undergone a
sea change. These days a film song can be put in or accessed by a single device along with a
textual message and even a painting. While all these have made communication among people
more effective and efficient both in terms of time and cost, they pose the greatest threat to the
copyright world. Modern communication channels, being intensively relying on a variety of
copyrighted products, are liable to be pirated in large scale, if adequate precautions are not
exercised.
Copyright is the right given by law to the creators of literary, dramatic, musical and a variety of
other works of mind. It ordinarily means the creator alone has the right to make copies of his or
her works or alternatively, prevents all others from making such copies. The basic idea behind
such protection is the premise that innovations require incentives. Copyright recognizes this need
and gives it a legal sanction. Moreover, commercial exploitation of copyright yields income to
the creators and thus making pecuniary rewards to individual’s creativity.
Though piracy was born by the end of the fifteenth century, it was only in 1710 the first law on
copyright in the modern sense of the term came into existence in England. The law which was
known as `Queen Anne's Statute' provided authors with the right to reprint their books for a
certain number of years. The 1710 law was confined to the rights of authors of books only, and
more particularly the right to reprint. It did not include other creative works such as paintings,
drawings etc. which also by that time became targets of piracy, in addition to other aspects
relating to books (e.g. translation, dramatization etc.) To overcome this problem a new enactment
namely `Engravers Act' came into existence in 1735. There followed a few more enactments in
the subsequent periods and ultimately Copyright Act 1911 saw the light of the day.
17
Developments in this regard also took place in many other advanced countries, notably among
them being France, Germany and the USA. In France a copyright decree was adopted in 1791
which sanctioned the performing right and another decree of 1793 established author’s exclusive
right of reproduction. In Germany author’s rights were recognized by a Saxon Order dated Feb
27, 1686. In America the first federal law on copyright, the Copyright Law 1790 provided
protection to books, maps and charts.
COPYRIGHT IN INDIA
The copyright in India has travelled a long way since it was introduced during the British rule.
The first law on copyright was enacted in the year 1847 by the then Governor General of India.
When Copyright Act 1911 came into existence in England, it became automatically applicable to
India, being India an integral part of British Raj. This act was in force in the country until after
independence when a new copyright act (the Act of 1957) came into effect in 1958. Thereafter
the Act has undergone many amendments. The latest in the series is the 1994 Amendment, which
came into force in May 1995.
The Indian Copyright Act confers copyright on (i) original literary, dramatic, musical and artistic
works, (ii) cinematographic films and (iii) sound recordings. The word `original' means that it
should not be copied from other works or alternatively it should be the outcome of independent
efforts. The Act empowers copyright holder(s) to do or authorize doing a number of activities.
The important among these are:
a)
b)
c)
d)
e)
f)
g)
to reproduce the work in material form
to publish the work
to perform the work in public or communicate it to the public
to produce, reproduce, perform or publish any translation of the work
to make any cinematographic film or a record in respect of the work
to make any adaptation of the work
to do, in relation to a translation or an adaptation of the work, any of the acts specified to
the work in sub clauses to (a) to (f).
The above mentioned rights are `exclusive' in the sense that the creator (or right holder) alone
has the right to enjoy these to the exclusion of others. The author by virtue of his creation
becomes the `owner' of the copyright in the work. However, there can be exceptions to this as in
the following two cases:
18
a) The creator may be employed by someone and having been employed to create a work,
the rights belong to the employer - not the creator(s), and
b) The creator may transfer his copyright by a document in writing to another person. This
is known as assignment.
The grant of copyright is a limited monopoly. It is limited in the `scope' of the rights granted and
in terms of `time'. In India, copyright on a literary work is provided for the lifetime of the author
plus sixty years after his death. In case of joint authorship, the sixty years period is calculated
from the beginning of the calendar year following the year in which the last (surviving) author
dies. Copyright with respect to photographs, cinematographic works and sound recordings spans
for 60 years of its first publication. In order to strike a balance between the society's need for
access to knowledge and the need to rewarding creators, limited uses of copyright protected
works are permitted without authors consent. These are called `fair use' of copyright. Section 52
of Indian Copyright Act permits certain activities which do not amount to infringement.
Important in this `exception list' are reproduction of literary, dramatic, musical or artistic works
for educational purposes, e.g. research, review etc., and reporting in newspapers, magazines and
periodicals etc.
The Copyright Act of India provides right holders a dual legal machinery for enforcing their
rights. The enforcement is possible through (1) the Copyright Board and (2) the courts. Legal
remedies include imprisonment and/or monetary fines - depending upon the gravity of the crime.
Sometimes remedies also include seizure, forfeiture and destruction of infringing copies and the
plates used for making such copies. The 1984 amendment has made copyright infringement a
cognizable non-bailable offence. Under the provisions of the Act any person who knowingly
infringes or abets the infringement of copyright is considered as an offender and is punishable
with a minimum of six months imprisonment which may extend to three years and a fine
between fifty thousand and two lakhs rupees. The 1994 Amendment has incorporated a special
penal provision for knowingly using an infringing computer software.
The punishment provided for this act is imprisonment for a term of seven days to a maximum of
three years and a fine between fifty thousand and two lakh rupees. In case the infringing copy of
the computer software is used not for pecuniary gain or in the course of trade or business, the
imprisonment can be relaxed and fine can be maximum of fifty thousand rupees. Besides
19
amending the Copyright Act the Indian Government has taken few more steps in strengthening
the enforcement in the country. A Copyright Enforcement Advisory Council has been set up for
advising the Government on measures for improving the copyright enforcement. Training
programmes and seminars are arranged for police personnel. Necessary legislation was made for
bringing video shops, cable operators under regulation. State governments are encouraged to set
up IPR cells for exclusively dealing with copyright and other IPR violations. In spite of all these,
enforcement of IPR violations, particularly copyright violations has not been strong enough in
the country and piracy prevails exits in all types of copyright works notably musical works,
video films and software.
Copyright Piracy
Copyright piracy is a phenomenon prevalent worldwide. Piracy means unauthorized
reproduction, importing or distribution either of the whole or of a substantial part of works
protected by copyright. The author of a copyrighted work, being the owner, enjoys certain
exclusive rights with respect to his or her works. These include right to reproduce, to publish, to
adopt, to translate and to perform in public. The owner can also sell, assign, license or bequeath
the copyright to another party if he wishes so. If any person other than the copyright owner or his
authorized party undertakes any of the above mentioned activities with respect to a copyrighted
product, it amounts to infringement of the copyright. Copyright piracy is thus like any other theft
which leads to loss to the owners of the property. Besides economic loss, piracy also adversely
affects the creative potential of a society as it denies creative people such as authors and artists
their legitimate dues.
There are different ways through which piracy takes place with the help of internet by using the
software. A computer software is pirated by simply copying it onto another machine not
authorized for its use. Book piracy takes place when a book is reproduced by someone other than
the real publisher and sold in the market or the internet. A performer's right is violated when a
live performance of an artist is recorded or telecasted live without his/her permission. In a
cinematographic work piracy generally takes place through unauthorized reproduction of the
film in video forms and/or displaying the video through cable networks without taking proper
authorization from the film producer (the right holder). In fact, there are numerous other ways
20
through which piracy of copyrighted works take place with the help of software. The nature and
extent of piracy also vary across the segments of the copyright industry.
COPYRIGHT LAWS IN INDIA
The amended Indian Copyright Act, 1994, section 14 states that it is it is against the law to
distribute or reproduce copies of copyrighted software without prior permission or license from
the software manufacturer. This makes it one of the toughest copyright laws in the world.
Violation of this law can result in the offender being charged both under civil as well as criminal
law. The maximum punishment for this offence is a prison term of up to seven years in prison
and a fine of two million rupees.
Laws are made, but the story doesn’t end there. Enforcing Laws is a different matter altogether.
Unfortunately, in developing countries, the task of law enforcement is not so easy. Government
agencies such as the Department of Electronics and the Ministry of Human Resource
Development along with NASSCOM and the Business Software Alliance are cooperating in
combating software Piracy in India. An Anti-Piracy Hotline is operational since 1995 for the
purpose.
The only exception to the Indian Copyright Act is section 57, which states that a person or
organization can reproduce or create backup copies of legitimate software that is licensed to that
person or organization. This is a loophole that is utilized to create multiple copies of copyrighted
software products. The rampant piracy in India not only plagues the software industry, but also
the music recording industry.
One cannot help feeling that the Indian copyright laws are hopelessly out of date with the current
technological trends. In this era of internet connectivity, more comprehensive and updated laws
are required. The reason for this, one might argue, is that broadband internet connectivity has not
fully penetrated all Indian homes. But, that day is not too far away. I estimate that in about 5
years, broadband internet will be as popular in India as it is in the US today. Only then will
serious thought be given to laws governing the role of the internet in software piracy.
21
PRACTICAL SOLUTION TO SOFTWARE PIRACY
Education
Education of the user involves creating public awareness through educational material,
advertisements, seminars, direct mailers where the user is informed about the consequences of
using pirated software and the advantages of legal software. Regular drives against corporate
using pirated software and an initiative to train and educate officials on software asset
management is also necessary. The legal consequences of using pirated software must be
effectively communicated to the user. The education campaign is imperative to educate users on
the advantages of using legal software, the problems associated with copied software, the legal
penalties.
Purchasing Control
To encourage use of legal software, many software companies in India, under a NASSCOM
initiative, announced a scheme under which software required for the purpose of training by the
private training institutes will be made available at the same rate at which it is available to other
universities or colleges. This is one way of ensuring that software remains within the purchasing
power of the average Indian Consumer.
Policy
Enforcement & Police Training NASSCOM in association with BSA has initiated a program of
police training and for the judiciary in the country to bring awareness on software piracy
amongst law enforcement agencies. NASSCOM has been conducting police training programs.
The association also plans to see that computer training institutes in the country only use legal
software. The Government as well as the Police and Judiciary is helping & supporting the
NASSCOM-BSA anti-piracy drive in all possible ways- Amendments in the Copyright Act;
Training of the Police, Conducting Raid and Training of the Judiciary. NASSCOM-BSA is
working with the government, a scheme through which every manager in a government
department or PSU (Public Sector Unit) will verify and sign a statement that according to
him/her, no pirated software is being used in their department. When a government officer signs
22
such a statement, it carries some political weight and can be used to persuade the government to
participate pro-actively against software piracy.
Pro-active Software Asset Management
NASSCOM is also working with various major corporates to have corporate software policy,
which will allow people to manage their software better. Special seminars on Software Asset
Management have been organized wherein international consultants have made presentations to
the corporate users on how to frame their software policy. NASSCOM-BSA also launched
Software Asset Management Seminars in different parts of the country viz. Bangalore, Chennai,
Delhi and Mumbai.
Self-Audits
Both corporate as well as home users should check if their software is original. They should also
check whether the software being used on their PCs and servers complies with the terms of the
End User License Agreement. Users have the choice of procuring the required licenses for the
software they use from vendors or their authorized distributors in their country.
23
CONCLUSION
This study provided an overview of software piracy and helped a deep understanding of the
topic. Software piracy can be argued as a consequence of technological innovation and the need
to protect those from their unauthorized reproduction remains an important objective for
copyright owners. Recently, the director of World Intellectual Property Organization
14
observed,
“copyright must be developed to meet the development of new technologies otherwise it will
become irrelevant on the theory and practice. So there is need to changes in law as per the nature
of piracy whether it is internet piracy or software piracy both piracy belongs into same footing.
Nowadays, stealing legitimate software is an easy and simple activity. People rarely
consider that stealing software is a criminal act, but it is. Software programs are protected under
the copyright law and they become copyrighted as soon as they are created. Distributing and
misusing of copy-righted software is considered a criminal act and those performing such
activities are subjected to paying fines with criminal proceedings. Moreover, there is also a risk
of spreading malware from the pirated software.
14 Francis Gurry spoke for the future of copyright at a conference, held at the Queensland University of
Technology,Australia, March 3, 2011.
24
REFRENCES
Al-Jabri, I. and A. Abdul-Gader (1997), “Software Copyright Infringements: An
Exploratory Study of the Effects of Individual And Peer Beliefs”, Omega, 25(3); 335-44.
Business Software Alliance (n.d., b), Internet Software Piracy Fact Sheet, Available on
http://www.bsa.org/ireland/antipiracy/upload/Internet-Piracy-Factsheet.pdf
Business Software Alliance (n.d., a), Software Piracy and the Law — Software Piracy in
the United States, Available on http://www.bsa.org/resources/upload/Software-Piracy-
and-the- Law.pdf
“What is Software Piracy: The Piracy Problem” http://www.siia.net/piracy/whatis.asp
The National Association of Software and Service Companies
http://www.copyright.gov/wipo/
http://www.nasscom.org
25
Project report on Intellectual Property Rights-I
Submitted To:
Assistant Prof. Amrita Pinak
Submitted By:
Shivani Jaiswal
B.B.A.LL.B (Hons.) – VII Semester
MATS University
MATS Law School, Raipur
1
ACKNOWLEDGEMENT
I express my sincere gratitude to Asst. Prof. Amrita Pinak , MATS Law School, Raipur, and
owe my foremost regards to her for giving me an opportunity to carry out this project work under
herguidance. This work would not have been possible without her invaluable support and
thought provoking comments.
I would also like to thank my batch mates who directly or indirectly helped me in making
this project.
2
DECLARATION
I, Shivani Jaiswal, undersigned hereby declare that this research report on Piracy on the
Internet on Intellectual Property Rights compiled and submitted by me is an original work
conducted under the guidance of Asst. Prof. Amrita Pinak. It is a work done by me as a partial
fulfillment of the Bachelor’s degree in Competition Law. No part of this work will be published
or copied for any purpose.
Date:
Shivani Jaiswal
Place- Raipur
3
RESEARCH METHODOLOGY
The research methodology that I have adopted in this project is the “Doctrinal Research
Methodology” where the sources of the project are solely based upon the materials collected
from the websites and books. Certain other resources for our project are several Articles
collected from various journals and magazines as well as several other commentaries and digests
written and published by several eminent scholars who have excelled in various fields of the
managerial fraternity nationally and internationally.
4
INDEX
S.No.
Topic
Page No.
1
INTRODUCTION
6
2
SOFTWARE PIRACY
8
3
KINDS OF SOFTWAER PIRACY
11
4
PROTECTION UNDER INTERNATIONAL INSTRUMENTS AND
14
THE NATIONAL LAW
5
6
COPYRIGHT PIRACY: THE BACKGROUND
17
22
7
PRACTICAL SOLUTION TO SOFTWARE PIRACY
CONCLUSION
24
8
REFRENCES
25
5
INTRODUCTION
Internet piracy has become so popular that 70% of people claim they see nothing morally wrong
with downloading illegal music and movies.1 Unfortunately, Internet piracy is not just a moral
issue, but also a global economic and social epidemic. The more the Internet grows and expands,
the more people are nonchalant about violating intellectual property rights. 2 The purpose of
copyright is to ensure that artists, producers, studios etc. will be able to claim their profits. If
action is not taken against Internet piracy, our generation will be the last to enjoy music and other
artistic productions because studios and companies will no longer be able to support themselves.
People are less likely to invest, or buy creative works if that work can be copied and resold by
third parties.3 Intellectual property is defined as “intangible property that is the result of
creativity.”4 Luxembourg is very proactive with IP standards and participates in all the major IP
meetings, and attends every IP treaties and conventions such as the Bern convention and the
Patent Cooperation treaty.5
The IP- Internet nexus can be looked at from three perspectives-the author, the user and the
services provider. An author created a piece of work and register it under the existing ip laws to
enjoy certain benefits, but the digital world hinders the complete enjoyment of these rights.
Copyright owners perceive Internet as a threat to their exclusive rights due to the following
1 “Online Piracy in Numbers-Facts and Statistics (info graphic)”, 2012; http://www.gogulf.com/blog/online-piracy/
2 “Internet Software Piracy: A Multifaceted Challenge”, BSA 2011;http://internet.bsa.org/overview/home.aspx
3
Jum
Picht,
“The
Stop
Online
Piracy
Act:
A
Cure…”,
2012;http://communities.washingtontimes.com/neighborhood/stimulus/2012/jan/18/stoponlinepiracy-act-cure-worse-disease/
January
18
4 “Intellectual Property”, Audio English,http://www.audioenglish.net/dictionary/intellectual_property.htm
5 “Eight Annual BSA Global Software: 2010 Piracy Study”, Business SoftwareAlliance Global Offices, May 2011;
http://portal.bsa.org/globalpiracy2010/downloads/study_pdf/2010_BSA_Piracy_Stud
y-Standard.pdf
6
reason: (i) Wide distribution is relatively simpler and quicker on the internet; (ii) Anyone can
distribute it to a mass audience; (iii) The quality of copies is virtually indistinguishable from the
original; (iv) Distribution is almost costless and (v) Users can easily and cheaply obtain
copyright on the internet.6 The Internet has become a gateway for the exploitation of other
people’s intellectual property. File sharing and illegally downloading music and movies is a
pressing issue that should be WIPO’s main focus. Companies all over the world are loosing
millions every year because of Internet piracy, so legislation needs to be passed in order to
compensate for their losses.7
The growth of the size and popularity of the Internet had an overwhelming effect on software
piracy and it is regarded as possibly the fastest growing type of software piracy. The Internet
faces the same laws and license agreements as physical software distribution; no differentiation
is made between offline and online infringement in the Copyright Act.
6The impact of the internet on intellectual property law, WIPO Programs Activities,
http:/www.wipo.int/copyright/commerce (29 Novenmber 2012).
7 Nathan Douglas, “Online Piracy: Combatting Theft and Censorship in theInformation Age”, 2012;
https://www.ohiobar.org/NewsAndPublications/OhioLawyer/Pages/Online-piracyCombating-theft-and-censorship-in-the-Information-Age.aspx
7
SOFTWARE PIRACY
Software is defined as a set of instructions which when incorporated in a machine readable form
or in capable of causing a computer to perform a particular task. To put it simply, it is a series of
commands which can be understood by the machine. There are three essential types of software
which help to function the computer, micro code which is a programme which controls the
details of execution, the operating system software which controls the sources of a computer and
manages routine tasks and which is a necessary requirement for a computer to function;
application software which is designed to perform a particular task. Piracy occurs when
copyrighted software is made available to users to download without the express permission of
the copyright owner. Such illegal software is offered over online sources such as online
advertisements newsgroups bulletin board service and auction sites. Piracy hampers creativity,
hinders the development of new software and local software industry and ultimately effects ecommerce. Piracy harms consumers and has negative impact on local and national economy.
Consumers run the risk of viruses and having corrupted and defective programs.
According to Nasscom,8 software piracy involves the use, reproduction or distribution without
having received the expressed permission of the software author. Software piracy comes in four
common forms. The first is end user piracy, and it occurs when users of software install the
software on more machines than they are entitled to under their license agreements. The second
is hard disk loading, and it occurs when computer dealers install illegal copies of software onto
computers prior to their sale. The third is software counterfeiting, and it involves the illegal
reproduction, and subsequent sale of software in a form that is nearly identical to the original
product. The fourth is Internet piracy, and it occurs when individuals place unauthorized copies
of software on the Internet for download.
Punishment:
Under the Indian Copyright Act, a software pirate can be tried under both civil and criminal law.
The minimum jail term for software copyright infringement is seven days, and the maximum jail
term is three years. Statutory fines range from a minimum of 50,000 to a maximum of 200,000
rupees.
8 The National Association of Software and Service Companies
8
Five Myths about Software Copy Protection:
1. Software piracy is a victimless crime.
Nothing could be further from the truth. According to industry statistics, illegal software use
costs publishers worldwide nearly $48 billion a year in lost revenues, with more than $8 billion
lost in the North America alone. In Central and Eastern Europe, an average of 68% of the
software in use is illegal. In some Asian and Eastern European markets, over 88% of software is
unlicensed.
2. Software copy protection makes software more expensive.
On the contrary, the price publishers pay for software copy protection is negligible compared to
the losses they incur through the pirating of their software. In fact, the vast majority of cases
have shown that investment in protection is offset entirely by increased sales and profit. By
protecting their software and thereby increasing their revenues, publishers can afford to supply
better software at more competitive prices. True, not everyone who copies software today would
buy it tomorrow if it were available only in a protected format. But, the ensured quality, support
and functionality that comes with a manufacturer’s copy is generally well worth an incremental
fee.
3. Software copy protection gets in the way of the legitimate user.
The new, more sophisticated types of software copy protection in no way hinder legitimate endusers, but instead work to benefit them. One important reason for this is because protection
safeguards the integrity of the software; the end-user is assured that the software cannot be
tampered with in any way. Additionally, higher revenues for developers mean that down the line,
users will benefit from better, higher quality software. Large organizations are legally liable for
the software they purchase and have a clear interest in preventing the unauthorized distribution
of that software. Often, the users themselves request that the software be protected, to ensure that
it won’t be used illegally, thus preventing future litigation.
4. Inexpensive software is not copied.
9
Some people attack the concept of software protection by arguing: “Make software cheaper,
that’s all. People don’t copy inexpensive software, and you’ll sell more copies of your product.”
The argument is inherently false. People who are inclined to copy software will copy the
inexpensive as well as the expensive software programs. The same people that are saying, “if
software were cheaper we would buy it,” are copying software that costs as little as $10. The
reality is that developing a software product requires a substantial investment of time and money,
and most software publishers simply cannot afford to lower their prices.
5. Any protection system can be cracked. Therefore, software copy protection is useless.
Only the first part of this myth is true: any software protection system can be cracked, just as any
lock can be picked or any door can be broken. However, the aim of software copy protection is
to provide protection for a reasonable period of time. Software cannot be protected forever, but it
can definitely be protected long enough (i.e., until the next version of the software product is
released). This new software version should again be protected, with a strong and field-proven
protection technology that has also been improved in parallel, thus ensuring a long and profitable
sales life for the protected software application.
10
KINDS OF SOFTWAER PIRACY
Software piracy is unauthorized reproduction of copyrighted software. The unauthorized
copying can be done for different purposes such as personal use, business use and even selling
copies of the pirated software. Even though pirating copyrighted soft-ware is illegal, there are
still millions of computer users pirating copyrighted software in the world. The rates of software
piracy have been increased rapidly with the growing use of computers and this activity not only
affects the economy of software companies but also affects the loyal customers who actually
purchase their products as intended.9 Software piracy occurs in different forms. The most
common form as defined by Micro-soft is considered to be “End User Piracy”. It happens when
individuals and businesses make copies of software without a license to do so. People may copy
a program and give it to others without realizing that this is software piracy. Similarly, an
organization may install software on more computers than its licenses allow. SIIA (Software and
Information Industry Association) and BSA are non-profit trade associations established to
advance the goals of the software industry and its hardware partners. They have listed some
common types of software piracy on their websites.
1. Soft lifting
Soft lifting is the act of illegal copying of software and distributing it to friends, organizations or
duplication and resale in violation of the terms of the license agreement. Many personal users
and enterprises are doing it knowingly or unknowingly and only few of them care about it. Such
activities lead software industry to lose billions of dollars each year and shatter the profitability
of large software companies as well as small ones. It often happens when organizations expand
computer capabilities and install unauthorized copies, rather than going through the purchasing
procedure. Soft lifting is sometimes referred to End User Piracy as in both cases one copy of
software is purchased for a particular machine and later installed on several machines in
violation of its copyright law.
9Business Software Alliance. The Compliance Gap [online]. June 2014.
URL:http://globalstudy.bsa.org/2013/downloads/studies/2013GlobalSurvey_Study_en.pdf. Accessed 28
June 2014.
11
2. Internet piracy
Nowadays, Internet piracy is one of the fastest and easiest ways to receive pirated software.
There are several websites that make software available for free download in a number of ways.
Many computer users download software from the Internet, which makes their lives easy as they
do not even need to visit stores or sending out copies of software on a CD-ROM or floppy disk.
These techniques have made our lives easier but at the same time they have also increased
internet piracy, which occurs in different forms such as downloading or uploading of illegal
copies of software over the Internet.10
3. Hard-disk loading
Hard-disk loading occurs when an individual or company sells computers preloaded with illegal
copies of software into the hard disks to encourage the consumer to buy their products. Since this
kind of activity is common, SIIA recommends computer buyers to confirm with the vendors that
software preloaded on the machines are legal and licensed copies. If the vendor is unwilling to
supply with the proper documentation, SIIA highly recommends not dealing with that vendor.11
4.
Software counterfeiting
Software counterfeiting is illegal duplication and sale of copyrighted software in such a way that
it appears to be authentic. Counterfeit software includes accompanying manuals that the original
legitimate software was sold and is usually sold at prices well below that of the retail price of the
legitimate software. This is the most typical type of software piracy and different organizations
are actively participating in stopping this kind of activity. Though counterfeit software is cheap
and easily available but it is also risky to use, since it can bring malware along with it. According
to a study, “The dangerous world of counterfeit and pirated software” conducted by IDC in 2013,
10 Software & Information Industry Association. What is Piracy ? [online]. URL:
http://www.faithaca.org/SIIA.pdf. Accessed 28 June 2014.
11 Software & Information Industry Association. What is Piracy ? [online]. URL:
http://www.faithaca.org/SIIA.pdf. Accessed 28 June 2014.
12
the chances of infection of malware from counterfeit software are 1 in 8 for consumers and 1 in 9
for businesses.12
5. Unauthorized use of academic software
Many software companies sell academic versions of their software to public schools, universities
and other educational institutions. When the software is labelled to use for academic or
educational purposes only, it cannot be used for commercial or other for-profit purposes. Using
academic software for private use in violation of the software license is a form of software piracy
and it not only hurts the software publisher, but also the institution that was the intended
recipient of the software.
6.
Renting
Renting involves someone renting out a copy of licensed software for temporary pur-poses. In
such type of piracy, software is rented to individual computers and returned the original software
to the renter. This method of piracy is not as common as other forms of piracy due to its
distribution nature but it still does exist. It has always been illegal to rent unauthorized copies of
software. The “Computer Software Rental Amendments Act” formed in the US in 1990 strictly
prohibits the rental, lease or lend-ing of a computer program for direct or indirect commercial
gain unless authorized by the owner of the copyright in the program.13
12 Kallol Bagchi, Peeter Kris, and Eobert Cerveny. Global software piracy: Can eco-nomic factors alone
explain the trend ? Journal of Communication of the ACM 2006;49(6):70-75. Accessed 4 December
2014.
13 Report on computer software rental act [online]. United States copyright office; 14 January 2003.
URL:http://www.copyright.gov/reports/software_ren.html.Accessed 4 July 2014.
13
PROTECTION UNDER INTERNATIONAL INSTRUMENTS AND THE
NATIONAL LAW
1. Trade Related Aspects of Intellectual Property Rights (TRIPS):
This is the first international treaty to explicitly include computer programs within the illustrative
list of copyrighted works. TRIPS set forth three different forms of protection for software:
copyright, patent and trade secrets. TRIPS includes a specific provision in Article 10 that
expressly requires member states to protect software, whether in source or object code, as literary
works under the Berne Convention. However, the member countries have a right to provide more
extensive protection of intellectual property rights within their national legal systems.
Article 27.1 recognizes patent protection for software related invention for the member states so
long as the invention satisfies the other requirements (6) for patentability which are country
specific. Therefore, software may be granted patent protection in a particular country if it fulfils
the specific conditions set forth under the laws of that country. Article 39 of TRIPS provides an
alternative to copyright protection. It talks about protection for undisclosed information and
offers a trade secret regime for software protection. Trade secret regime is applicable for the
protection of trade secrets which may include software. A particular software may contain lot of
valuable and confidential information about a company which forms its trade secret. Civil and
criminal actions are provided for in most legislation against the unauthorized disclosure or use of
confidential information. In this case, there is no exclusive right, but an indirect type of
protection based on a factual characteristic of the information (its secret nature) and its business
value. Unlike patents, trade secrets are protected as long as the information is kept secret. Thus,
TRIPS does not preclude additional forms of protection for computer programs and a member
can offer patent, copyright and trade secret protection for computer programs. Keeping in mind
the higher standards of creativity required by patent law the software developer can choose any
form of protection which is most desirable to him. As the source code is comprehensible only by
a trained programmer and not by normal persons, the proprietors generally protect the source
code under the trade secret regime and the object code is protected as a copyright.
2. Berne Convention (BC):
14
The Berne Convention does not explicitly mention computer programs in its illustrative list of
copyright works. However, as per TRIPS, member states should recognize computer programs
(software) as literary works. Article 2 (7) of the Berne Convention makes the protection of works
of applied art dependent on domestic legislation i.e. the extent to which protection may be
granted and the conditions under which such works will be protected is dependent on the statute
of the particular country where the work originated. Works enumerated in Article 2 of the Berne
Convention are mere illustrations of the kinds of works to which copyright might extend. These
illustrations are not exhaustive. Therefore, works such as computer programs that exhibit
utilitarian characteristics and also contain expressive elements can be brought under the ambit of
work of applied art. However, Article 7 (4) of the Berne Convention exempts, inter alia, the
works of applied art from the general term of protection and sets up a minimum term of only 25
years from the making of the work. As article 2 (7) makes the protection of works of applied art
dependent on domestic legislations, the term of protection may be applicable accordingly with
respect to different countries.
3. Universal Copyright Convention (UCC):
Under the UCC’s national treatment provisions, software created by a U.S. author or first
published in the US is protected in other UCC member countries to the extent that the member
country’s copyright laws protect software. The UCC provides that any member country that
requires, as a condition of copyright protection, compliance with formalities (such as
registration, deposit or notice) must treat such formalities as satisfied if all published copies of a
work bear the symbol “©”, the name of the copyright proprietor and the year of first publication.
This provision applies, however, only to works that (i) were first published outside the country
requiring the observance of the formalities, and (ii) were not authored by one of that country’s
nationals. In contrast to Berne Convention, formalities such as registration are permitted under
the UCC in order to bring an infringement suit. India being a member to the UCC, authors of
software in US will get protection in India also as per the terms and conditions laid down in the
Indian copyright law.
4. World Intellectual Property Organization (WIPO):
15
In 1996, two copyright treaties were negotiated under the auspices of WIPO. These treaties are:
WIPO Copyright Treaty (WCT) and the WIPO Performances and Phonograms Treaty (WPPT).
The WCT of 1996 is a special agreement to the Berne Convention and requires compliance with
Berne Convention. This treaty makes explicit that computer programs are protected as literary
works under Berne Convention. It also states that compilations of data for which the selection or
arrangement of the contents are sufficiently original are protected as compilations.
16
COPYRIGHT PIRACY: THE BACKGROUND
The world today has entered into an era of instant communication. A person sitting in the
remotest corner of India can enjoy live performance taking place in the faraway places like
America or Africa, thanks to electronic (parallel) media. Telephone and fax have made it possible
to communicate oral or written messages across the globe within seconds. The computer-aided
communication technologies such as E-Mail and Internet have added altogether a new dimension
to today's communication process by making it more speedy, informative and economical. The
ways through which different types of information can be communicated have also undergone a
sea change. These days a film song can be put in or accessed by a single device along with a
textual message and even a painting. While all these have made communication among people
more effective and efficient both in terms of time and cost, they pose the greatest threat to the
copyright world. Modern communication channels, being intensively relying on a variety of
copyrighted products, are liable to be pirated in large scale, if adequate precautions are not
exercised.
Copyright is the right given by law to the creators of literary, dramatic, musical and a variety of
other works of mind. It ordinarily means the creator alone has the right to make copies of his or
her works or alternatively, prevents all others from making such copies. The basic idea behind
such protection is the premise that innovations require incentives. Copyright recognizes this need
and gives it a legal sanction. Moreover, commercial exploitation of copyright yields income to
the creators and thus making pecuniary rewards to individual’s creativity.
Though piracy was born by the end of the fifteenth century, it was only in 1710 the first law on
copyright in the modern sense of the term came into existence in England. The law which was
known as `Queen Anne's Statute' provided authors with the right to reprint their books for a
certain number of years. The 1710 law was confined to the rights of authors of books only, and
more particularly the right to reprint. It did not include other creative works such as paintings,
drawings etc. which also by that time became targets of piracy, in addition to other aspects
relating to books (e.g. translation, dramatization etc.) To overcome this problem a new enactment
namely `Engravers Act' came into existence in 1735. There followed a few more enactments in
the subsequent periods and ultimately Copyright Act 1911 saw the light of the day.
17
Developments in this regard also took place in many other advanced countries, notably among
them being France, Germany and the USA. In France a copyright decree was adopted in 1791
which sanctioned the performing right and another decree of 1793 established author’s exclusive
right of reproduction. In Germany author’s rights were recognized by a Saxon Order dated Feb
27, 1686. In America the first federal law on copyright, the Copyright Law 1790 provided
protection to books, maps and charts.
COPYRIGHT IN INDIA
The copyright in India has travelled a long way since it was introduced during the British rule.
The first law on copyright was enacted in the year 1847 by the then Governor General of India.
When Copyright Act 1911 came into existence in England, it became automatically applicable to
India, being India an integral part of British Raj. This act was in force in the country until after
independence when a new copyright act (the Act of 1957) came into effect in 1958. Thereafter
the Act has undergone many amendments. The latest in the series is the 1994 Amendment, which
came into force in May 1995.
The Indian Copyright Act confers copyright on (i) original literary, dramatic, musical and artistic
works, (ii) cinematographic films and (iii) sound recordings. The word `original' means that it
should not be copied from other works or alternatively it should be the outcome of independent
efforts. The Act empowers copyright holder(s) to do or authorize doing a number of activities.
The important among these are:
a)
b)
c)
d)
e)
f)
g)
to reproduce the work in material form
to publish the work
to perform the work in public or communicate it to the public
to produce, reproduce, perform or publish any translation of the work
to make any cinematographic film or a record in respect of the work
to make any adaptation of the work
to do, in relation to a translation or an adaptation of the work, any of the acts specified to
the work in sub clauses to (a) to (f).
The above mentioned rights are `exclusive' in the sense that the creator (or right holder) alone
has the right to enjoy these to the exclusion of others. The author by virtue of his creation
becomes the `owner' of the copyright in the work. However, there can be exceptions to this as in
the following two cases:
18
a) The creator may be employed by someone and having been employed to create a work,
the rights belong to the employer - not the creator(s), and
b) The creator may transfer his copyright by a document in writing to another person. This
is known as assignment.
The grant of copyright is a limited monopoly. It is limited in the `scope' of the rights granted and
in terms of `time'. In India, copyright on a literary work is provided for the lifetime of the author
plus sixty years after his death. In case of joint authorship, the sixty years period is calculated
from the beginning of the calendar year following the year in which the last (surviving) author
dies. Copyright with respect to photographs, cinematographic works and sound recordings spans
for 60 years of its first publication. In order to strike a balance between the society's need for
access to knowledge and the need to rewarding creators, limited uses of copyright protected
works are permitted without authors consent. These are called `fair use' of copyright. Section 52
of Indian Copyright Act permits certain activities which do not amount to infringement.
Important in this `exception list' are reproduction of literary, dramatic, musical or artistic works
for educational purposes, e.g. research, review etc., and reporting in newspapers, magazines and
periodicals etc.
The Copyright Act of India provides right holders a dual legal machinery for enforcing their
rights. The enforcement is possible through (1) the Copyright Board and (2) the courts. Legal
remedies include imprisonment and/or monetary fines - depending upon the gravity of the crime.
Sometimes remedies also include seizure, forfeiture and destruction of infringing copies and the
plates used for making such copies. The 1984 amendment has made copyright infringement a
cognizable non-bailable offence. Under the provisions of the Act any person who knowingly
infringes or abets the infringement of copyright is considered as an offender and is punishable
with a minimum of six months imprisonment which may extend to three years and a fine
between fifty thousand and two lakhs rupees. The 1994 Amendment has incorporated a special
penal provision for knowingly using an infringing computer software.
The punishment provided for this act is imprisonment for a term of seven days to a maximum of
three years and a fine between fifty thousand and two lakh rupees. In case the infringing copy of
the computer software is used not for pecuniary gain or in the course of trade or business, the
imprisonment can be relaxed and fine can be maximum of fifty thousand rupees. Besides
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amending the Copyright Act the Indian Government has taken few more steps in strengthening
the enforcement in the country. A Copyright Enforcement Advisory Council has been set up for
advising the Government on measures for improving the copyright enforcement. Training
programmes and seminars are arranged for police personnel. Necessary legislation was made for
bringing video shops, cable operators under regulation. State governments are encouraged to set
up IPR cells for exclusively dealing with copyright and other IPR violations. In spite of all these,
enforcement of IPR violations, particularly copyright violations has not been strong enough in
the country and piracy prevails exits in all types of copyright works notably musical works,
video films and software.
Copyright Piracy
Copyright piracy is a phenomenon prevalent worldwide. Piracy means unauthorized
reproduction, importing or distribution either of the whole or of a substantial part of works
protected by copyright. The author of a copyrighted work, being the owner, enjoys certain
exclusive rights with respect to his or her works. These include right to reproduce, to publish, to
adopt, to translate and to perform in public. The owner can also sell, assign, license or bequeath
the copyright to another party if he wishes so. If any person other than the copyright owner or his
authorized party undertakes any of the above mentioned activities with respect to a copyrighted
product, it amounts to infringement of the copyright. Copyright piracy is thus like any other theft
which leads to loss to the owners of the property. Besides economic loss, piracy also adversely
affects the creative potential of a society as it denies creative people such as authors and artists
their legitimate dues.
There are different ways through which piracy takes place with the help of internet by using the
software. A computer software is pirated by simply copying it onto another machine not
authorized for its use. Book piracy takes place when a book is reproduced by someone other than
the real publisher and sold in the market or the internet. A performer's right is violated when a
live performance of an artist is recorded or telecasted live without his/her permission. In a
cinematographic work piracy generally takes place through unauthorized reproduction of the
film in video forms and/or displaying the video through cable networks without taking proper
authorization from the film producer (the right holder). In fact, there are numerous other ways
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through which piracy of copyrighted works take place with the help of software. The nature and
extent of piracy also vary across the segments of the copyright industry.
COPYRIGHT LAWS IN INDIA
The amended Indian Copyright Act, 1994, section 14 states that it is it is against the law to
distribute or reproduce copies of copyrighted software without prior permission or license from
the software manufacturer. This makes it one of the toughest copyright laws in the world.
Violation of this law can result in the offender being charged both under civil as well as criminal
law. The maximum punishment for this offence is a prison term of up to seven years in prison
and a fine of two million rupees.
Laws are made, but the story doesn’t end there. Enforcing Laws is a different matter altogether.
Unfortunately, in developing countries, the task of law enforcement is not so easy. Government
agencies such as the Department of Electronics and the Ministry of Human Resource
Development along with NASSCOM and the Business Software Alliance are cooperating in
combating software Piracy in India. An Anti-Piracy Hotline is operational since 1995 for the
purpose.
The only exception to the Indian Copyright Act is section 57, which states that a person or
organization can reproduce or create backup copies of legitimate software that is licensed to that
person or organization. This is a loophole that is utilized to create multiple copies of copyrighted
software products. The rampant piracy in India not only plagues the software industry, but also
the music recording industry.
One cannot help feeling that the Indian copyright laws are hopelessly out of date with the current
technological trends. In this era of internet connectivity, more comprehensive and updated laws
are required. The reason for this, one might argue, is that broadband internet connectivity has not
fully penetrated all Indian homes. But, that day is not too far away. I estimate that in about 5
years, broadband internet will be as popular in India as it is in the US today. Only then will
serious thought be given to laws governing the role of the internet in software piracy.
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PRACTICAL SOLUTION TO SOFTWARE PIRACY
Education
Education of the user involves creating public awareness through educational material,
advertisements, seminars, direct mailers where the user is informed about the consequences of
using pirated software and the advantages of legal software. Regular drives against corporate
using pirated software and an initiative to train and educate officials on software asset
management is also necessary. The legal consequences of using pirated software must be
effectively communicated to the user. The education campaign is imperative to educate users on
the advantages of using legal software, the problems associated with copied software, the legal
penalties.
Purchasing Control
To encourage use of legal software, many software companies in India, under a NASSCOM
initiative, announced a scheme under which software required for the purpose of training by the
private training institutes will be made available at the same rate at which it is available to other
universities or colleges. This is one way of ensuring that software remains within the purchasing
power of the average Indian Consumer.
Policy
Enforcement & Police Training NASSCOM in association with BSA has initiated a program of
police training and for the judiciary in the country to bring awareness on software piracy
amongst law enforcement agencies. NASSCOM has been conducting police training programs.
The association also plans to see that computer training institutes in the country only use legal
software. The Government as well as the Police and Judiciary is helping & supporting the
NASSCOM-BSA anti-piracy drive in all possible ways- Amendments in the Copyright Act;
Training of the Police, Conducting Raid and Training of the Judiciary. NASSCOM-BSA is
working with the government, a scheme through which every manager in a government
department or PSU (Public Sector Unit) will verify and sign a statement that according to
him/her, no pirated software is being used in their department. When a government officer signs
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such a statement, it carries some political weight and can be used to persuade the government to
participate pro-actively against software piracy.
Pro-active Software Asset Management
NASSCOM is also working with various major corporates to have corporate software policy,
which will allow people to manage their software better. Special seminars on Software Asset
Management have been organized wherein international consultants have made presentations to
the corporate users on how to frame their software policy. NASSCOM-BSA also launched
Software Asset Management Seminars in different parts of the country viz. Bangalore, Chennai,
Delhi and Mumbai.
Self-Audits
Both corporate as well as home users should check if their software is original. They should also
check whether the software being used on their PCs and servers complies with the terms of the
End User License Agreement. Users have the choice of procuring the required licenses for the
software they use from vendors or their authorized distributors in their country.
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CONCLUSION
This study provided an overview of software piracy and helped a deep understanding of the
topic. Software piracy can be argued as a consequence of technological innovation and the need
to protect those from their unauthorized reproduction remains an important objective for
copyright owners. Recently, the director of World Intellectual Property Organization
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observed,
“copyright must be developed to meet the development of new technologies otherwise it will
become irrelevant on the theory and practice. So there is need to changes in law as per the nature
of piracy whether it is internet piracy or software piracy both piracy belongs into same footing.
Nowadays, stealing legitimate software is an easy and simple activity. People rarely
consider that stealing software is a criminal act, but it is. Software programs are protected under
the copyright law and they become copyrighted as soon as they are created. Distributing and
misusing of copy-righted software is considered a criminal act and those performing such
activities are subjected to paying fines with criminal proceedings. Moreover, there is also a risk
of spreading malware from the pirated software.
14 Francis Gurry spoke for the future of copyright at a conference, held at the Queensland University of
Technology,Australia, March 3, 2011.
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REFRENCES
Al-Jabri, I. and A. Abdul-Gader (1997), “Software Copyright Infringements: An
Exploratory Study of the Effects of Individual And Peer Beliefs”, Omega, 25(3); 335-44.
Business Software Alliance (n.d., b), Internet Software Piracy Fact Sheet, Available on
http://www.bsa.org/ireland/antipiracy/upload/Internet-Piracy-Factsheet.pdf
Business Software Alliance (n.d., a), Software Piracy and the Law — Software Piracy in
the United States, Available on http://www.bsa.org/resources/upload/Software-Piracy-
and-the- Law.pdf
“What is Software Piracy: The Piracy Problem” http://www.siia.net/piracy/whatis.asp
The National Association of Software and Service Companies
http://www.copyright.gov/wipo/
http://www.nasscom.org
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