Critics blast EU antipiracy proposal

In an effort to stamp out digital counterfeiting and piracy of products like music and movies, European lawmakers are criminalizing many legitimate businesses, according to companies such as Nokia and Microsoft.

IT vendors are not the only ones concerned. Legal academics in Europe share these companies' concerns about the proposed law on intellectual property enforcement, which is due to be debated in the European Parliament in the coming weeks.

If the proposal was adopted in a form championed by a leading European Parliamentarian, a teenager who illegally downloads music from the Internet could face a jail sentence. So too could the teenager's ISP, if it didn't agree to reveal the music file sharer's identity.

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In an effort to stamp out digital counterfeiting and piracy of products like music and movies, European lawmakers are criminalizing many legitimate businesses, according to companies such as Nokia and Microsoft.

IT vendors are not the only ones concerned. Legal academics in Europe share these companies' concerns about the proposed law on intellectual property enforcement, which is due to be debated in the European Parliament in the coming weeks.

If the proposal was adopted in a form championed by a leading European Parliamentarian, a teenager who illegally downloads music from the Internet could face a jail sentence. So too could the teenager's ISP, if it didn't agree to reveal the music file sharer's identity.

If it takes the form proposed by its author, the European Commission, the law would discourage technology firms such as Nokia from innovating, according to its opponents.

The Commission and the Parliament both want to make the proposed law broad-ranging, and by doing so both institutions have been accused of being biased towards the owners of copyright, patents, and other forms of intellectual property.

No one questions the main aim of the bill. Counterfeiting costs the computer industry about €3 billion ($3.5 billion) in sales last year, because approximately 35% of software acquired in Western Europe last year was pirated, according to industry lobby group, the Business Software Alliance, based in Washington, D.C.

According to the International Federation of Phonographic Industries, one in three music CDs sold around the world last year were pirated copies. The federation estimates that sales of pirate CDs that year were worth $4.6 billion.

Everyone agrees that a pan-European law punishing counterfeiters is the only sensible way to deal with counterfeiting rings, which rarely limit themselves to one country.

However, the critics argue that the proposal extends far beyond the murky world of criminals.

Nokia, for example, fears that by covering patents, the directive threatens the economic well-being of innovation-based businesses in Europe.

"It is vitally important that this directive strikes the right balance between protecting the interests of rightholders without unfairly impeding others from competing in the same market," said Tim Frain, Nokia's director of intellectual property.

Patent infringement is an everyday risk for innovators, and risk assessment is a business decision, said Frain, adding that if patent infringement were to be made punishable by criminal sanctions, it would act as a strong disincentive for executives.

Introducing such harsh remedies for good faith infringements would present new risks and liabilities for companies conducting bonafide business in Europe, he said.

Microsoft's senior legal counsel, Marie-Therese Huppertz, shares some of Frain's concerns. Questioning whether there should there be the same rules for patent infringements as for counterfeiting, she agreed that criminal sanctions for patent infringers may well stifle innovation.

The IDG News Service is a Network World affiliate.