Criminalizing Copyright Piracy

CRIMINALISING COPYRIGHT PIRACY CRIMINALISING COPYRIGHT PIRACY By Shumayl Aziz Advocate High Court, Islamabad Introduction The main purpose of criminalising copyright piracy is to vilify the activity of copyright piracy and to deter people from committing it. The Concise Oxford Dictionary' gives two definitions for the word piracy; the first definition describes piracy as 'the practice of attacking and robbing ships at sea',2 whereas the second definition describes piracy as 'the unauthorized use or reproduction of another's work'.3 It is the second definition which is pertinent to the present discussion but the first definition is more evocative and natural. Whenever the word piracy is mentioned it brings to mind the images of pirates, adventure, skulduggery, ships, swords and daggers. Although there might be semantic differences between the piracy of yore and piracy of today but the purpose of piracy has always been the same which is extortion. According to Christopher N Kendall and Linda McNamara the word piracy 'is more commonly and colloquially used by the courts and legal commentators to describe the illegal dealing in infringing copies of work to which copyright or other intellectual property rights attach.'4 In the modern age copyright piracy has become an anathema for copyright owners. The technological improvements have made it very easy for pirates to reproduce copyrighted works without any substantial investment on their part. Further, the society generally does not consider piracy as an immoral act. Darren Spalding points out that 'Advances in technology and the advent of digitisation have spawned an age and culture of copyright piracy. Copyright infringement has become acceptable to the community psyche, gaining legitimacy due to its prevalence and the apparent lack of any negative consequences for the infringers'.5 The lack of an effective deterrent is the main reason put forward by scholars as the cause of escalation in piracy rates throughout the world. The remedies available through the civil courts have not been very effective in controlling piracy. Those who make a living through copyright piracy treat the fines and damages awarded by the civil courts as overheads. In the opinion of one commentator 'criminal sanctions such as the stigma of a criminal record and a jail term may be the only effective deterrent against pirate operations that treat civil damages as just another cost of doing business's. However it should be borne in mind that copyright, law is not just about protecting the rights of copyright owners. The basic purpose of copyright law is the benefit of the whole society. By giving too much power to copyright owners it might adversely affect the rights of copyright users. The key to a nation's progress lies in the effective use of earlier works and therefore criminal sanctions should not impede public access to knowledge. Copyright should only be a crime if it is on a commercial scale and the aim is to make a profit. Such an act will adversely affect the copyright . owner's rights and will discourage creativity. Geraldine Szott Moohr argues that 'Criminalising infringement emphasises one objective of copyright policy, to encourage innovation, at the expense of its Second objective, to maintain public access to information. Imposing criminal sanctions when infringement is for personal use and for circumventing copy protection constricts public access to copyrighted material, which may, in turn result in reduced innovation.'' Thus a balance has to be maintained between the rights of the users and those of the owners. With the rise in globalization there has been an escalation in the rate of copyright piracy. This is because the copyright laws are different in different countries and every country gives copyright piracy a different level of protection. Countries which are developed give more protection to copyrighted works whereas developing countries turn a blind eye to the acts of copyright piracy because it is in their economic interests. In a study on copyright piracy sponsored by the Indian government it was concluded that 'though social factors like illiteracy, unemployment etc. influence piracy, the phenomenon occurs more because of economic reasons than anything else. For pirates it is an easy way of making quick bucks. For the end users it is a gainful arrangement for buying/using a variety of info-entertainment products which otherwise remain unaffordable at least to a large majority. Basically this `win-win' -situation for pirates and end users keeps the piracy alive and active in the society. Other socio-economic variables like poverty and high prices etc. only add -to the degree of the problem.'8 Thus the basic reason for the prevalence of piracy in developing countries has been identified as economic constraints. The country which is causing the most problem and in which copyright piracy is an epidemic is China. According to Eric Priest `no country contributes more to piracy problem, or will play a more critical role in shaping the future of international piracy, for better or worse, than China.'9 China has been responsible for causing a huge loss to the U.S music and film industry. Eric Priest points out that 'U.S loses in China due to piracy range from about $1.85 to $2.54 Billion annually in displaced sales of CD's, DVD's, VCD's (Video Compact Discs), and software.'10 The reason put forward by commentators for high prevalence of piracy in China are varied but most of them acknowledge that the Chinese culture is mainly responsible for widespread piracy in China. Jing Zhang points out 'that Chinese tradition, due to its emphasis on the noble motivation in creating art, ignores individual creativity.'" Further, another - reason put forward for the prevalence of piracy in China is the inability of the common man to afford legitimate goods. As a result of widespread piracy and because the piracy is causing a huge loss to the U.S. the U.S.T.R on 10 April 2007 brought an action against China in the W.T.O for intellectual property violations.12 The case has not been decided as yet. The Trade Related Aspects of Intellectual Property agreement (TRIPS)13 has also been a driving force in urging member countries to amend their domestic intellectual property laws so that the laws are in line with the TRIPS mandate. Thomas E Volper explains that 'TRIPS establishes a set of minimum standards for IPR protection among members.'14 China and Australia have both made drastic changes to their intellectual property laws so that these are consistent with TRIPS requirements. This essay will argue that criminalizing copyright piracy is an effective deterrent to stop copyright piracy. It will emphasize that piracy should only be a crime if it is on a commercial scale and is carried out for profit. Part II of this essay will give a brief history of copyright piracy and the efforts made by publishers and copyright owners to criminalize copyright piracy, it will also give a philosophical justification for the need to criminalize piracy, and will analyse the different international treaties and the obligations arising under those treaties to criminalise copyright piracy. Part III of the essay will examine copyright piracy in China. Its efforts to curb piracy, the difficulties faced by it in stamping out piracy and how far has it been successful in implementing its obligations under TRIPS. Part IV of the essay will examine Australia's efforts to curb copyright piracy. The essay will give an overview of the amendments effected in the copyright law by Australia to meet its obligations under international treaties. It will also shed light on an important case dealing with the first ever custodial sentence awarded for copyright piracy in Australia. Part II A Brief History of Copyright Disputes The need to criminalise copyright piracy is not a new phenomenon. Copyright piracy has been around for ages and has been a thorn in the side of copyright owners since time immemorial. A brief glimpse of the past is necessary to justify the need for criminalising copyright infringement. Darren Spalding narrates that in ancient times the Greeks and Romans did not write books to make money but to spread knowledge.16 Their basic purpose in writing books was to educate others.16 But history also reveals that lectures and speeches were a commercial commodity and were bought and sold in the market, moreover, the poet Marshall's use of the word 'Plagiarius' (Kidnapper)17meant that books, speeches, lectures etc. could be misappropriated.18 This shows that copyright infringement had its root in antiquity and literary works were a valuable commodity. An interesting anecdote related by Spalding in his article is the first ever recorded dispute over copyright. Spalding narrates that in 567 AD Saint Columba visited the monastery of his old teacher, Abbot Finnian, and copied the Abbot's psalter.'19 Finnian requested his student to return his book. Columba refused. Finnian then made a petition to King Dermott urging him to compel Columba to return his psalter who had 'taken it' without his permission. Columba replied that his purpose in taking the psalter was to disseminate knowledge and to spread the religion. The King adjudicated in the favour of Abbot.20 This anecdote demonstrates that copyright even in antiquity was a recognizable right. Although copyright was a recognized right since ancient times but it was the printing press which gave it notoriety. According to Melissa De Zwart 'Copyright emerged at the time of the invention of the printing press, not directly because of the technology itself, but as a consequence of concerns raised by the proliferation of the written word which the printing press made possible.'21 The printing press made it possible to make copies of books and other printed material on a mass scale. This meant that knowledge was not the monopoly of a privileged few anymore but anyone could have access to it. The power of the printing press also made dissemination of information very easy which made the government apprehensive because the printing press could be used to sow dissent. Melissa De Zwart explains , that 'the government was concerned to control religious and political dissent and the most effective way to do this was to control those who controlled the presses. This control was exercised in two ways: first, through the licensing of the printing and bookselling guilds,... and secondly, through the granting of printing patents...'.22 In order to control the printing presses the Stationers Company was established in 1556.23 The Stationers Company was given a full monopoly over printing and in return they had to censor seditious materia1.24 The members of the Stationers Company were booksellers and publishers, whereas the authors were refused membership of the Company.25 These powers expired with the cessation of the Licensing Acts in 1694.26 The monopoly of the booksellers had caused a lot of bitterness and for that reason the Licences Acts were not renewed.27 It was alleged that the printers usurped the labours of the authors.28 order to protect the rights of the authors the Statute of Anne was enacted in 1709.29 The preamble of the Act clearly lays down that the Act was promulgated to protect the authors from being exploited by the printers and to compensate the authors for their labours. The Act also contained penalties for copyright infringement which was forfeiture of the infringing copies that were to be destroyed upon confiscation and the payment of one penriy for every sheet found in the infringers possession. Thus there' were penalties for infringement even in the first Copyright Statute, The history of copyright until the enactment of Statute of Anne reveals that copyright has always been a controversial subject. There are so many competing interests involved that it is difficult to maintain an equilibrium. The Statute of Anne established one thing that the interests of the authors took precedence over the claims of other stakeholders. Even after the promulgation of the Statute of Anne and countless other Statutes the copyright owners were still clamouring for more protection. Jing Zhang points out that 'the major reason for piracy is economic self interest'.30 History reveals that countries who are now the champions of intellectual property rights were themselves in the past the biggest pirates. According to Isabella Alexander 'the United States did not recognise foreign copyright for most of the nineteenth century and local publishers freely published British books and music,...'.31 Piracy is the easiest and quickest way of gaining economic self sufficiency. Zhang relates that The United States has a short history but people seem not to remember that the United States "was one of the most notorious pirates of Intellectual Property".32 Assafa Endeshaw adds that 'A study for the U.S Congress admitted that U.S was a "Pirate". "When the United States was still a relatively young and developing country ... it refused to respect International Intellectual Property Rights on the ground that it was freely entitled to foreign works to further its social and economic development"33. This shows that countries who are now advocating strong protection for intellectual property rights owners had in the past resorted to piracy because their survival depended upon it. Stealing ideas was the quickest way of getting rich. Today United States is the most developed country in the world and protecting intellectual property rights is in its economic interest. Zhang points out that 'Intellectual Property is the United States economy's "largest export and source of revenue.-34 The U.S realized quite early the deleterious effects of piracy to its economy and thus made it a criminal offence way back in the nineteenth century. According to Mary Jane Saunders Copyright infringement in U.S became a criminal offence in 1897.35 Saunders points out that only unauthorised rerformance of musical and dramatic works was a crime, other acts of infringement such as unauthorised reproduction of copyrighted works were not considered a crime. The only remedy available to stop unauthorised reproduction was to bring a civil action against the infringers36. Likewise copyright infringement was made a criminal offence by virtue of section 11 of the Copyright Act 1911 in all British dominions since the beginning of the 20th century. Section 11 of the Copyright Act 1911 provides that 'If any person knowingly (a) makes for sale or hire any infringing copy...; (b) sells... or by way of trade exposes or offers for sale...; (c) distributes infringing copies...; or (d) by way of trade exhibits in public...; or (e) imports...any such work: he shall be guilty of an offence...'. Thus copyright piracy is not a new dilemma and criminalisation of copyright piracy is not a modern concept but has been around for a considerable length of time. Further, the earlier Copyright Acts reveal that copyright infringement was only considered a crime if the works were reproduced for a commercial purpose. This implies that the objective of criminalising copyright was to safeguard the economic interests of the author. In order to see whether the protection of economic interests should be the only justification for criminalising copyright piracy, it will be useful to explore the philosophy behind criminalisation of copyright piracy. Justification for Criminalising Copyright According to Justice Louis Harms 'piracy is a...species of theft',37 a natural corollary of that would be, since theft is a crime therefore copyright piracy should also be a crime. But there is a difference between theft and copyright- piracy. Theft deals with tangible property whereas copyright piracy deals with intangible property. When a physical item is stolen the owner is deprived of a tangible asset whereas in copyright piracy there is an unauthorized reproduction of the author's work which might cause a financial loss to the author but there is no loss of a physical asset the owner retains the possession of the property. In other words there is no reduction in the inventory. But loss of a physical asset should not be treated as a benchmark to criminalise a particular conduct. According to Lawrence Lessig `creative work has value; whenever I use, or take or build upon the creative work of others, I am taking from them something of value. Whenever I take something of value from someone else, I should have their permission. The taking of something of value from someone else without permission is wrong. It is a form of piracy.'38 Thus copyright piracy deprives the author of his labours, and is ethically and morally a reprehensible act. According to Paul Goldstein 'it is unjust to deprive authors of the reward for their labours, to allow second comers to reap where they have not sown.'39 Although it is acknowledged that progress can only be made by buildirig on the works of others but the original author has to be given attribution and compensation otherwise the incentive to create will be lost. The commentators advance two justifications for criminalising copyright piracy. The first is to protect the moral rights and the second is to safeguard the economic interests of the author. The moral rights argument says that whatever a man produces through his efforts rightly belongs to him and to deprive him of the fruits of his labour without compensation is immoral and unjust. The moral right's theory owe its origin to Locke's Labour Theory. According to Locke Though all earth, and all inferior creatures be common to all men, yet every man has a property in his own person. This nobody has any right to but himself. The labour of his body, and the work of his hands, we may say are properly his.'40 Since copyright is a type of property, therefore depriving the author of his property should be a crime because it is an immoral act. According to Geraldine Szott Moohr, a conduct is a crime if it violates a moral principle, since copyright is a form of property therefore infringing it is like stealing it which amounts to violation of a moral norm. Thus copyright should be a crime based on the moral rights theory.41 The second theory advanced by the commentators for criminalising copyright piracy is the economic rights theory which says that copyrighted works are a valuable commodity and its unauthorised use causes a financial loss to the author. According to Geraldine Szott Moohr 'A person or entity with an interest in copyrighted material suffers some degree of deprivation when that product is used or reproduced without authorization.'42 The rationale underpinning the economic theory is that it gives an incentive to the author to create original works if that incentive is taken away the author will lose motivation to produce more creative works. One important point that has to be kept in mind when criminalising copyright is that piracy should only be a criminal offence if it is carried out for commercial purposes. One of the reasons for not criminalising copyright infringement for personal use is that the harm caused is miniscule. Geraldine Szott Moohr ex-plains that punishment should be commensurate to the harm caused; since the harm caused by an individual who reproduces copyrighted work for personal use is slight therefore the infringement should not merit criminal sanctions as that would be unjust.'" Further, moral theory criminalises copyright only if the conduct is considered immoral by the society. There is evidence that copyright infringement for personal use is not considered as an immoral act. Geraldine Szott Moohr holds that 'existing social norms do not provide a consensus that personal, unauthorised use of copyright material is so immoral as to merit criminal sanctions.'44 Moreover, Paul Sugden points out that the Recording Industry Association of America (RIAA) has admitted that prosecuting' individuals for copyright' infringement is causing a financial loss to the industry.45 It is therefore, sensible to make only those infringements a criminal offence which causes a substantial loss to the copyright owner. The suggestion to criminalise copyright piracy only if it is can-led out for commercial purposes also finds support from the TRIPS agreement. At this stage of the essay it will be useful to analyse the different international treaties which impose an obligation on the member countries to give protection to intellectual property rights by criminalising copyright infringement. The Obligation to give Protection to Intellectual Property Rights under the Various International Treaties: There are three important international treaties which deal with copyright piracy. This paper will deal with each one in turn. (a) TRIPS Agreement According to Justice Louis Harms the TRIPS agreement is the first international treaty which requires signatories to make copyright piracy a criminal offence.46 Article 61 of the TRIPS agreement provides that 'Members shall provide for criminal procedures and penalties to be applied at least .in case of willful trademark counterfeiting or copyright piracy on a commercial scale. Remedies available shall include imprisonment and/or monetary fines sufficient to provide a deterrent, consistently with the level of penalties applied for crimes of a corresponding gravity.' Thus the TRIPS agreement categorically lays down those member countries should make copyright infringement on a commercial scale a criminal offence in order to deter people from committing the infringement. Further, Art. 41 of TRIPS lays down that 'Members shall ensure that enforcement procedures ... are available under their law so as to permit effective action against any act of infringement of intellectual property rights...' Although the term effective action is ambiguous but it does imply to deal with copyright infringement in a diligent manner which will eradicate the problem, and the only way to do that is through criminal sanctions. The second treaty which requires member States to give protection to copyright works is the WIPO Copyright Treaty.47 (b) WIPO Copyright Treaty (WCT1 Article 14.2 of the WCT provides that 'Contracting Parties shall ensure that enforcement procedures are available under their law so as to permit effective action against any act Of infringement of rights covered by this treaty, including expeditious remedies to prevent infringements and remedies which constitute a deterrent to further infringements.' Although WCT does not clearly require member States to provide criminal penalties for copyright infringement but the words 'remedies which constitute a deterrent to further infringements' clearly indicates that the treaty had envisaged that the member countries will provide criminal sanctions for copyright infringements. Darren Spalding is also of the opinion that TRIPS and WCT both require that members should have penalties for copyright infringement.48 The third treaty which requires member countries to give protection to copyrighted works is the Berne Convention.49 (c) Berne Convention The Berne Convention does not require that there should be criminal sanctions for copyright infringement but it does require member countries to seize infringing material wherever found. Article 16.1 provides that 'Infringing Copies of a work shall be liable to seizure...'. The reason for not providing criminal penalties could be that the Berne Convention was last amended on 28 September 1979. At that time copyright piracy was not a big issue and could be reined through civil remedies, it was only after the arrival of Internet that the piracy problem spiralled out of control. Further, Article 19 lays down that member countries are at liberty to provide greater protection to copyrighted works if they deem it necessary which implies that member countries have the discretion to impose criminal sanctions for copyright piracy if they deem it essential. Thus the drafters of the Berne Convention were not so myopic after all. This paper will now examine the protection granted to copyrighted works by China and Australia and will analyse as to how far they have been successful in implementing Article 61 of TRIPS. It must be pointed out at the outset that neither China nor Australia are members of WCT. Part IV China Eric Priest writes that 'Piracy, whether physical or in cyberspace, is the single greatest threat to the world's entertainment industries. And no country contributes more to the piracy problem, than China.'50 According to Kate Colpitts Hunter 'Ninety per cent of the music and movies available in China are pirated copies.'51 Further, piracy 'costs U.S companies $250 billion a year'.52 These facts demonstrate that piracy is causing a huge financial loss to foreign companies operating in China. Despite the rampant piracy foreign investors cannot ignore China because of its large population and burgeoning economy.53 Despite the complaints about the rampant piracy in China, China has made substantial changes to its copyright law to bring it in line with the TRIPS agreement. China did not have a copyright statute until 199.0. According to Zhou Lin, an American delegation visited China in 1979 in order to sign a bilateral trade agreement. During the course of negotiations the American delegation pointed out that the agreement could not be signed until China had a copyright law. This demand completely stumped the Chinese because until that moment the copyright regime was unknown in China. In order to comply with the American demand a committee was set up to draft a copyright law and this is how copyright law came into existence.54 The first copyright law was promulgated in 1990 by the National People's Congress (NPC).55Although the new law recognised that an author had economic and moral rights in his works but it maintained that the purpose of granting protection in works was to promote socialism. This objective is contrary to the concept of intellectual property which is premised on individualism whereas the Copyright Law 1990 advocates collectivism and thus State control. Despite its shortfalls it laid the foundation for copyright law in China. China joined the World Trade Organization (WTO) on 11th December 2001.56 But before it joined the WTO China had to make substantial changes in its domestic intellectual property laws so that they were in harmony with the TRIPS agreement, because TRIPS requires that member States must provide a minimum level of protection to Intellectual Property Rights. Article 1.1 of TRIPS provides that Members... shall not be obliged to implement in their law more extensive protection than is required by this agreement,...' There is no doubt that China has made considerable changes to its laws and its intellectual property laws are to a greater extent in compliance with the TRIPS mandate.57 As far as compliance with Article 61 of TRIPS is concerned China seems to have made the requisite changes. Eric Priest reports that in order to comply with the international demands the Chinese government amended its Criminal Law back in 1997 and included a section in its Criminal Law Statue which made intellectual property infringements a crime.58 According to Article 217 of the Criminal Law 1997,59 a person will be guilty of an offence if he/she commits copyright infringement for the purpose of making a profit. Further, Article 217 of Criminal Law 1997 provides that in case of fairly large profits gained from copyright infringement the punishment would be imprisonment and/or a fine. The maximum duration of imprisonment cannot be more than 3 years for large profits. Article 217 also says that if the profits reaped are huge the infringer would be liable to imprisonment or/and a fine. The jail term for huge profits cannot be less than 3 years or more than 7 years. Moreover, Article 218 provides that whoever sells infringing works for profits and thereby reaps a huge profit will be sentenced to imprisonment the duration of which will not be more than 3 years and he/she can be fined as well. Although prima facie the criminal penalties seem to be in line with the requirements of Article 61 of TRIPS, but there- are a few shortfalls in the law. The Criminal law does not define large profits, and 'huge profits'. These terms are defined by judicial interpretations which are promulgated periodically.60 This means that there is no consistency in the law and the threshold set down by judiciary smacks of arbitrariness. Moreover, Article 218 says that the sales have to be huge before a criminal penalty can be imposed which implies connivance. These shortcomings were removed by the promulgation of a Judicial Interpretation in 2004 by the Supreme People's Court and the Supreme People's Procuratorate.81 The 2004 Judicial Interpretation gives an interpretation of large profits and huge profits. Article 5 of the 2004 Judicial Interpretation provides that profits are large if the amount of profit is more than RMB 30,000 (about $4,391) and the profits are huge if the amount of profits are more than RMB 150,000 (about $21,958). Further, Article 6 of the 2004 Judicial Interpretation provides that in relation to the acts mentioned in Article 218 of the Criminal Law 1997 the profits will be considered huge if they are more than RMB 100,000 (about $14,639). These measures apparently are sufficient because TRIPS only requires minimum level of protection; it does not require a complete overhaul of the legal system. Moreover, Article 41.5 of TRIPS says that a member is not bound to give more protection to intellectual property rights than it gives to other rights. Despite China's efforts to curb piracy it is still being excoriated by foreign countries who have invested in China. According to Eric H. Smith 'China's flawed administrative system, with low deterrent fines, is not working and China must turn to relying on its criminal law if it is to significantly lower piracy rates as promised. This still has not happened.'62 Thus the laws are in place but they are not being implemented. The basic reason for non-implementation of laws is the Chinese culture. Intellectual property is premised on the notion that whatever a man/woman creates belongs to him/ her, whereas in China, which has a collectivist culture, whatever someone creates must be used for the benefit of everyone. The mindset of a Chinese can be summed up in the following words 1For a Chinese writer], if his views are copied out and passed around, he is delighted... if they are seized upon, printed and scattered to the furthest corners of the Empire, he folds his hands and dies triumphant. He has said what was in him to say, and men have listened.-83 This kind of mindset has existed in China for hundreds of years and to demand that the Chinese change their time honoured philosophies in a few years is absurd. Priest explains that the concept of copyright never existed in China and therefore copyright infringement was not considered a crime, the concept of copyright was introduced in China when the Chinese came into contact with the West back in the nineteenth century. 64 China started giving protection to Intellectual Property rights in earnest when Ding Xiaoping became leader. It was under his leadership that China opened its doors to foreign investment. It was felt that the only way to encourage foreign investment was through strengthening of intellectual property laws and therefore extensive changes were made to intellectual property regime to harmonize it with international standards. Although laws can be changed with a single stroke of a pen but it takes time to change the mindset of the people and therefore China requires more time to transform itself into a country with robust protection for intellectual property rights.' Part IV Australia Piracy problem is also prevalent in Australia, although, it might not be as bad as in China but it still causes the Australian industries a huge loss. According to the Business Software Association of Australia (BSAA) copyright piracy caused $677 million of lost sales, representing $200 million in lost profits to Australia.65 According to the Music Industry Piracy Investigations (MIPI), in relation to sound recordings, piracy caused a loss of $67,000,000 to Australia in 1998.66 Further, the Motion Picture Association reported that in 1999 the total number of infringing items seized were 11,458 which were worth $687,000.67 Lastly, Sony has estimated that games piracy causes the Australian Industry a loss of $30 million a year.68 These statistics are an indication that the copyright piracy problem is quite serious in Australia. The attorney General of Australia has said that The Australian Government is committed to tackling copyright piracy. The Government regards this activity as stealing. ...However the government is concerned piracy rates in Australia and overseas appear to be on the rise'.69 Copyright infringement has been a criminal offence in Australia since 1912. Section 14 of the Copyright Act 1912 (Cth) provided that copyright infringement was an offence and the punishment for a recidivist was a fine or imprisonment 'with or without hard labour for a term not exceeding two months.' Thus copyright infringement even at the dawn of 20th century was considered a crime in Australia. Although copyright infringement was an offence but the offence provision was never resorted to.7 In spite of its non-use the Spicer Committee was of the opinion that the criminal sanctions should be retained because copyright infringers were mostly poor people who did not have the means to pay a fine and therefore the only way to deter them was through criminal sanctions.71 The Copyright Act 1968(Cth) gave effect to the criminal sanctions through section 132. Section 132 of the Criminal Act 1968 was repealed by the Copyright Amendment Act 2006(Cth). Section 132 of the Copyright Act 1968 has been substituted by section 132AA to 132AU of the new amendment. The Copyright Amendment Act 2006 made extensive changes to the criminal provisions. The new amendment introduced a tiered system of criminal offences. According to the new system the offences are either indictable, summary or strict liability depending upon the state of the mind. According to David Brennan 'the offences contain similar physical elements but have different fault elements...'.72 According to the Honorable Philip Ruddock such a system 'ensures that the penalty, while continuing to provide an appropriate level of deterrent, is also proportionate to the seriousness of the conduct.'73 According to Brennan, in the new tiered system an indictable offence carries a maximum penalty of 5 years' imprisonment and/or a maximum fine of 550 to 850 units, the fault element required for an indictable offence is intention or recklessness, a summary offence requires a fault element of negligence, and carries a maximum penalty of 2 years' imprisonment and/or a fine of 120 units, and the strict liability offence does not require a fault element and carries a maximum penalty of 60 units." According to section 4AA of the Crimes Act 1914(Cth) a penalty unit equals $110. This would mean that a maximum fine for an indictable offence would be $93,500, for a summary offence the maximum fine would be $13,200 and for a strict liability offence the maximum fine will be $6,600. The new strict liability provisions have been castigated for being too harsh and that it exceeds the 'requirements of Article 61 of TRIPS.75 The claim of the government is that the strict liability offences make the administration of justice more cost effective and expeditious.76 Since these are early days therefore, it would be premature to pass a judgment on the effectiveness of the new system. On the whole the new amendments seem to have streamlined the copyright laws have made it easier for the prosecution to get a criminal conviction. One of the major complaints made by the prosecution was that it was very difficult to prove ownership in copyright infringement cases. The insertion of section 132A obviates this problem by introducing evidentiary presumptions relating to subsistence and ownership of copyright. Section 132A of the Copyright Act 1968 presumes that the owner of the work is the person whose name is printed on the work or in whose name a certificate is issued by a qualifying country which states that the person whose name is printed on the certificate is the owner. Although the criminal sanctions have been enacted but there seems to be a dearth of custodial sentences. The only case in which a custodial sentence has been awarded is Le v. R.77. The case of Le proves that copyright infringement for commercial purposes will be dealt with harshly. In this case Le was found guilty for five infringements of, copyright by possessing an infringing article for sale or hire, one infringement of possessing an article for committing an infringement on copyrighted work, and for five infringements of possessing goods with fake trademarks.78 She was sentenced to imprisonment for 12 months for each of the 11 offences which were to run concurrently.79 Le appealed against the harshness of the sentence.80 It was held by Edmonds J that the sentence could only be interfered with if it was disproportionate to the crime committed and was an abuse of discretion.81 The court also acknowledged that the appellant was the first person to have been awarded a custodial sentence for the offence which she committed.82 In the end the court came to the conclusion that the sentence was appropriate because the appellant was a recidivist and a custodial sentence would act as a deterrent to discourage her from committing similar crimes in the future.83 Moreover, the magnitude of the infringement and the underlying commercial purpose went against the appellant.84 This punishment sends a clear message to all pirates that the Australian Courts will show no clemency. Conclusion Copyright piracy is causing a huge loss to the economies of many countries. It is also having a harmful effect on innovation. One of the basic goals of copyright is to spur creativity, copyright piracy is a threat to that purpose. Using criminal sanctions to curb pirvacy is an important measure, but copyright piracy should only be a criminal offence if it is committed on a commercial scale. The reason is that the loss caused to the copyright owners through copying for personal use is negligible and prosecuting individuals is a money losing venture. Moreover, in many countries people do not consider copying for personal use as morally wrong. The examination of Chinese copyright law reveals that the laws are to a greater extent in compliance with Article 61 of TRIPS but China is having enforcement problems, caused by cultural impediments. China should be given more time to comply with international intellectual property standards, because it has a huge potential for investment and the transition from socialism to capitalism is a gradual process which will take time. Australia on the other hand has enacted stringent laws to curb copyright infringement on a commercial scale. Australia must be careful that in its crusade against copyright piracy it should not lose sight of the other goal of copyright law which is access to knowledge. BIBLIOGRAPHY Books 1. Bainbridge D, Intellectual Property (4th ed, Pearson Education Limited, Hampshire, 1999). 2. Feng P, Intellectual Property in China, 157 (2003). 3. Goldstein P, Copyright's Highway: From Gutenberg to the Celestial Jukebox (Revised edition, Stanford University Press, Stanford, 2003). 4. Gurnsey J, Copyright Theft (Aslib Gower, Hampshire, 19.95). 5. 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Id citing Australia, Spicer Committee Report of the Copyright Law Review Committee (1960), para 330. 72. David Brennan, 'New Exceptions, Criminal Provisions and other notable reforms', LIV presentation (2007), Law 7011 Copyright, Volume 2 Course Materials, prepared by David Lindsay, Moliash University, p 336. 73. Ruddock P, (2007) 20(3) IPI.B 30, 31. 74. David Brennan, op cit (n 72), p 336. 75. Sugden P, op cit.- (11 45), p 225. 76. Ruddock P on cit In 7:11 77. (2007) 74 IPR 1. 78. Ibid at para 2. 79. Ibid at para 3. 80. Ibid at para 1. 81. Ibid at para 28. 82. Ibid at para 29. 83. Ibid at para 30. 84. Id.