SOFTWARE PIRACY AND THE LAW (PHILIPPINES)

WHAT IS SOFTWARE PIRACY? Perhaps the most visible type of software piracy is the sale of counterfeit CD-ROMs in retail outlets. However, there exist numerous forms of software piracy, each of which contributes to the billions lost in revenue to the software industry annually. The five common types of software piracy are: End-user piracy This is the most damaging form of software piracy to the BSA, and is also known as corporate end-user piracy. This occurs when businesses, schools, nonprofit organizations and government institutions make additional copies of software without authorization. Client-server Overuse This occurs when too many employees on a network use a central copy of a program at the same time. Internet Piracy While there are many publishers who offer authorized versions of their software for sale online, there are also numerous pirate operations on the Internet as well: o o o Pirate websites that make software available for free download or in exchange for uploaded programs. Internet auction sites that offer counterfeit, out-of-channel, infringing copyright software. Peer-to-Peer networks that enable unauthorised transfer of copyrighted programs.

Internet piracy represents perhaps the single greatest threat to electronic commerce. Hard Disk Loading This occurs when the business who sells you a new computer loads illegal copies of software onto its hard disk to make the purchase of the machine more attractive. Software Counterfeiting This is the illegal duplication and sale of copyrighted material with the intent of directly imitating the copyrighted product. In the case of packaged software, it is common to find counterfeit copies of the CDs or diskettes incorporating the software program, as well as related packaging, manuals, license agreements, labels, registration cards, and security features.

WHAT IS THE LAW? Intellectual Property Rights in the Philippines are currently governed by the new Intellectual Property Code of the Philippines. The Philippines is also a member of the Berne Convention for the protection of Literary and Artistic Words. Under the new Code, original works are protected by the sole fact of their creation. It is not necessary to register a work, or to do anything else to obtain the protection of the code. Further more, original works are protected regardless of their content, quality, purpose, or the form of their expression. Among other things, the Code expressly protects computer programs as literary works. The Code also protects the copyright in the manuals and packaging, which accompany the software. Some notable points about the new law are: It expressly protects databases and tables. It grants an exclusive rental right to the copyright owner. It recognizes and expands the protection of an authors moral rights. That is, the right of an author to preserve the integrity of their works and their name. It penalizes the possession of infringing software for the purposes of sale.

HOW DOES THE LAW WORK? Intellectual Property Rights Code protects the copyright owners rights by giving the copyright owner the exclusive right to do certain things with the works, which in this case are the computer program, the manuals, and the packaging. These exclusive rights include: The right to copy the whole program or a substantial part of it. The right to adapt or translate the program. The right to rent the program to another person. This means that you may only copy, adapt or rent a computer program if the copyright owner gives you the permission to do this. This permission is given in the form of a license. Every time you purchase a legitimate copy of a computer program, you will receive a license agreement. This agreement will tell you how you may use the computer program. If you do anything with the computer program, which is not permitted under the license agreement (or the IP Code), then you will have breached the Code and will be liable for the penalties.

WHAT ARE THE PENALTIES? 1st offense: Imprisonment of 1 year to 3 years plus a fine ranging from P50,000 to P150,000. 2nd offense: Imprisonment of 3 years and 1 day to 6 years plus a fine ranging from P150,000 to P500,000. 3rd offense to subsequent offenses: Imprisonment of 6 years and 1 day to 9 years plus a fine ranging from P500,000 to P1.5 million.

Under Philippine law, the copyright owner may also bring a civil action for infringement of copyright. If the court finds that a breach of copyright has occurred, then it may award an injunction prohibiting further breaches, and/or either monetary compensation for the damage suffered, or an account of profits made as a result of the infringement. The court may also award the copyright owner moral and exemplary damages. Under the new Code, the Intellectual Property Office may order the cancellation of any permit, authority or registration that the Office had granted. The Office may also impose various penalties including cease and desist orders, condemnation or seizure of the products, administrative fines and award of damages. HOW CAN I AVOID BREAKING THE LAW? Buy and use only original software its as simple as that. The manner in which you can use a computer program is set out in the license agreement. Always read the license agreement because the terms and conditions for use of the software will vary from product to product. However, if you follow these guidelines when using BSA member products, you are unlikely to break the law.* Load and use the software on one computer at a time. Do not make more than one copy of the program for back-up purposes. Do not load the software onto a server. Do not let someone borrow your software.

*These guidelines do not apply to special multiple user licenses. If you are unsure, ask your software reseller or the BSA. WHY SHOULD I CARE? If you use counterfeit or copied software, then you face imprisonment and fines. But legal risks aside, you are also exposing you or your business to the risk of: Lost time

Lost money Lost credibility Lost business

One of the greatest dangers of using counterfeit software is its ability to destroy valuable data. Counterfeit software is more likely to contain computer virus and corrupt files, which can bring your organization to a grinding halt. The only guarantee that comes with the use of counterfeit software is the guarantee of no original documentation, no technical support, no distribution of upgrades, and no quality assurance. Counterfeit software does not give you or your organization the assurance of functioning efficiently. It is counter productive to every investment your organization makes. HOW DO I KNOW IF I HAVE A GENUINE COPY? It is not always easy to tell if a particular copy is genuine or not. Many counterfeit packaged products are designed to look identical to that of the original manufacturers products. Some indicators that a program may be a counterfeit copy are: The price is too good to be true. The program is on a compilation CD-ROM that is, a CD-ROM containing a large number of programs, from a variety of different software developers. The CD-ROM is of gold color. The product is being sold in only a shrink-wrapped plastic CD-ROM case. There is no retail packaging. You do not receive a license agreement, registration card or manuals with the program.

If you are uncertain about whether a program is the genuine product, the you should contact the BSA for assistance. ABOUT BSA The Business Software Alliance (www.bsa.org) is the foremost organization dedicated to promoting a safe and legal online world. The BSA is the voice of the world's software and Internet industry before governments and with consumers in the international marketplace. Its members represent the fastest growing industry in the world. BSA educates computer users on software copyrights; advocates public policy that fosters innovation and expands trade opportunities; and fights software piracy. BSA members include Adobe, Apple Computer, Autodesk, Bentley Systems, Borland, CNC Software/Mastercam, Compaq, Dell, Entrust, IBM, Intel, Intuit, Macromedia, Microsoft, Network Associates, Novell, Sybase, Symantec, and Unigraphics Solutions.

In the Philippines, BSA is a member of the Information Technology and ECommerce Council (ITECC) International Advisory Board and maintains a Memorandum of Understanding with the Philippine Software Association, the Philippine Internet Service Organization, the Institute of Internal Auditors and the Association of Government Internal Auditors. REPORT SOFTWARE PIRACY P1,000,000.00* Reward Anti-piracy hotlines: 811-5897 (Metro Manila) 1-800-1-888-8787 (outside Metro Manila) or visit www.bsa.org *Terms and conditions apply