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Laws Against Software Piracy in India

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Manish Jindal

January 8, 2024

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Laws Against Software Piracy in India

In an increasingly digital world, the significance of laws against software piracy cannot be overstated. These software piracy laws serve as the bedrock for combating software piracy and online copyright infringement.

As technology advances, so do the complexities surrounding intellectual property protection. This article delves into the intricate landscape of software piracy laws, exploring the pivotal role they play in safeguarding digital assets.

From the implementation of technological measures to the enforcement of legal provisions, we navigate the multifaceted strategies and regulations that aim to preserve the integrity of software in an era of relentless digital innovation.

Laws Against Software Piracy in India

India does not have specific statutes dedicated to combating software piracy.

However, there are several provisions within existing legislations that serve to address and mitigate this issue. Here is a summary of the key anti-software piracy legislations in India:

A. Substantive Legislations:

  1. The Copyright Act, 1957: This legislation primarily deals with the protection of copyrights, making it illegal to copy or distribute original software without proper authorisation from the copyright holder.
  2. The Trade Marks Act, 1999: While primarily focused on trademarks, this act also includes provisions that can be applied to prevent software piracy and counterfeiting.
  3. Indian Penal Code, 1860: Relevant sections of the IPC can be invoked to address various aspects of software piracy, such as fraud, counterfeiting, and unauthorised access to computer systems.

B. Procedural Legislations:

  1. Civil Procedure Code, 1908: The CPC provides procedural guidelines for handling civil cases related to software piracy, including issues of intellectual property infringement.
  2. Criminal Procedure Code, 1973: The CrPC outlines the procedures for conducting criminal trials and investigations related to software piracy cases.
  3. Intellectual Property Rights (Imported Goods) Enforcement Rules, 2007: These rules empower authorities to take action against the importation of counterfeit or pirated software and related goods.

While India lacks dedicated legislation exclusively targeting software piracy, these existing laws provide a framework to address and combat this menace, safeguarding the intellectual property rights of software creators and businesses.

Legal Provisions Against Software Piracy in India

Copyright Act, 1957

In India, the provisions related to the piracy of a software are encompassed within the Indian Copyright Act of 1957, as amended in 1994.

This amendment introduced crucial elements, including the definition of a ‘Computer Program’ and the identification of an infringing copy as any copy used without the proper license or permission granted by the copyright owner.

Furthermore, it introduced penal provisions under Section 63B of the Act, which is titled “Knowing use of infringing copy of computer programme to be an offence.” The section stipulates the following:

Section 63B: Knowing use of infringing copy of computer programme to be an offence:

Any person who knowingly employs an infringing copy of a computer programme on a computer shall be liable to punishment.

The term of imprisonment shall not be less than seven days but may extend to three years, accompanied by a fine ranging from not less than fifty thousand rupees to a maximum of two lakh rupees.

It is important to note that if the computer programme has not been utilised for profit or in the course of trade or business, the court, under specific and compelling reasons documented in the judgment, may decide not to impose a prison sentence and instead impose a fine of up to fifty thousand rupees.

The Trade Marks Act, 1999

The Trade Marks Act of 1999 assumes a pivotal role in addressing trademark violations and brand name infringements. It offers both civil and criminal avenues for recourse in cases of trademark violations.

Civil Remedies Available Under the Act:

  1. Trademark Infringement Suit: Pursuant to Section 27(1) of the Act, individuals can file a lawsuit for trademark infringement, seeking remedies such as injunctions, damages, or accounts of profits, as appropriate to the circumstances.
  2. Passing Off Action Suit: Under Section 27(2) of the Act, individuals can initiate a suit for passing off action, seeking remedies including injunctions, damages, or accounts of profits, as deemed necessary.
  3. Infringement Suit with Additional Injunctions: Parties can file a suit for infringement while also seeking specific injunctions like Mareva injunctions, Jon roe Orders, or Anton Pillar Orders, depending on the case requirements.
  4. Damages Suit: Damages can be claimed under this Act, including actual damages and exemplary or punitive damages.

Criminal Remedies Available Under the Act:

  1. Criminal Complaint for Falsification: Section 103 of the Trade Marks Act, 1999, enables the filing of criminal complaints against those falsifying or falsely applying trademarks.
  2. Police Complaint for False Application: A police complaint can be lodged with the Deputy Superintendent of Police, alleging the false application of a trademark. This complaint asserts that an offense has been committed or is likely to be committed, and may request search and seizure of the goods and moulds involved in the violation.

Indian Penal Code, 1860

The Indian Penal Code, 1860, though not explicitly defining piracy, offers clarity through Section 28, which elucidates what constitutes counterfeiting.

Counterfeiting is described as the act of causing one object to resemble another with the intention of deceiving or with knowledge that such deception is likely to occur.

Engaging in counterfeiting or piracy falls within the purview of cheating under Section 415 of the IPC. Those found guilty of cheating may face imprisonment for up to one year, a fine, or both, as prescribed by law.

Intellectual Property Rights (Imported Goods) Enforcement Rules, 2007

One of the significant challenges facing India today is the proliferation of counterfeit goods across borders.

To combat the influx of counterfeits through cross-border movements, the Ministry of Finance, Department of Revenue, implemented the Intellectual Property Rights (Imported Goods) Enforcement Rules, 2007, which strengthen intellectual property and customs regulations.

Under Rule 3(1) of these Rules, a right holder has the prerogative to submit a written notice to the Commissioner of Customs or any authorised Customs officer at the point of importation of goods suspected of infringing intellectual property rights.

This request seeks the suspension of goods clearance, pending an investigation into the infringement of intellectual property rights.

Impact of Software Piracy on the Economy and Industry

Software piracy, involving the unauthorised duplication or distribution of software without proper licensing or permission, exerts significant economic and industry-wide effects:

  1. Financial Losses: The most glaring impact is financial, as software piracy leads to substantial revenue losses for software developers and the industry as a whole. These losses can amount to billions of dollars annually.
  2. Inhibited Innovation: Reduced earnings from software sales often result in diminished investments in research and development. This, in turn, stifles innovation and impedes the creation of new and improved software programs.
  3. Employment Displacement: The economic consequences of online piracy can lead to job displacement within the software industry, with companies scaling back hiring or implementing layoffs due to diminished revenues.
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  5. Undermined Competitiveness: Piracy can undercut the competitiveness of legitimate software providers, particularly in emerging markets. It creates an unfair playing field, where piracy becomes a cheaper alternative to legally licensed software.
  6. Tax Revenue Reduction: Governments lose potential tax revenue as a consequence of underreported or unreported software sales. This can negatively impact public services and infrastructure development.
  7. Cybersecurity Vulnerabilities: Pirated software often lacks crucial security updates and patches, rendering users more susceptible to cyberattacks. This elevated cybersecurity risk affects individuals and organisations alike.
  8. Erosion of Intellectual Property Rights: Widespread piracy erodes respect for intellectual property rights, affecting not only the software industry but also other sectors.
  9. Export Limitations: High piracy rates in a country can curtail its capacity to export software and technology-related services, hindering economic growth and trade prospects.
  10. Reputation Damage: Countries with high piracy rates may suffer from a tarnished international reputation, deterring foreign investment and potential partnerships.
  11. Inefficiency and Unreliability: Pirated software often proves less reliable and efficient than licensed versions, impacting productivity and efficiency across various industries.

In summary, software piracy takes a toll on the economy and industry, resulting in financial losses, innovation stagnation, job displacement, and broader repercussions affecting multiple sectors.

The imperative to combat Internet piracy remains essential for the vitality and sustainability of software companies and the overall economy.

Stringent software piracy laws, backed by legal consequences, are crucial to address the proliferation of illegal copies through the internet, peer networks, and other means, safeguarding intellectual property rights and promoting lawful software use.

Measures to protect software

Protecting software from unauthorised use, distribution, and piracy is paramount for software developers and companies.

Here are essential measures to safeguard software:

  1. Licensing and Activation: Implement robust licensing systems that require users to activate their software through legitimate means. Activation keys or online verification can help ensure only authorised users access the software.
  2. Encryption: Encrypt sensitive parts of the software’s code and data to deter reverse engineering and tampering. This adds an extra layer of protection against unauthorised access.
  3. Digital Rights Management (DRM): Employ DRM solutions to control and monitor the distribution and use of digital content. DRM technologies help prevent illegal copying and sharing.
  4. Code Obfuscation: Obfuscate the software’s source code to make it challenging for hackers to understand and modify. This can deter reverse engineering and unauthorised alterations.
  5. User Authentication: Implement strong user authentication mechanisms, including password protection, two-factor authentication, or biometric authentication, to ensure only authorised users access the software.
  6. Cloud-Based Solutions: Consider offering software as a service (SaaS) through the cloud, which can provide better control over access and usage.
  7. Monitoring and Reporting: Implement tools to monitor software usage and gather data on potential infringements. This can aid in identifying piracy and taking appropriate actions.
  8. Copyright Registration: Register the software with relevant copyright authorities to establish legal rights and facilitate enforcement actions.
  9. Penalties and Enforcement: Be prepared to take legal action against software pirates. Consult with legal experts and authorities to enforce intellectual property rights.
  10. Secure Distribution: Ensure secure distribution channels for your software. Use secure download links, employ secure packaging, and consider software escrow services for added protection.
  11. Customer Support: Provide excellent customer support to legitimate users, encouraging them to choose legal options and report piracy.

Protecting a piece of software requires a multi-faceted approach, combining technological, legal, and educational measures. A proactive stance against internet piracy helps preserve the value of software and ensures fair compensation for developers’ efforts.

Conclusion

Laws against software piracy play a pivotal role in upholding the principles of intellectual property rights and safeguarding the software industry.

These laws, backed by copyright regulations and reinforced by robust license agreements, are essential in combating end-user piracy and the proliferation of illegal software.

Security features, preventive measures, and online security efforts work in tandem to thwart digital infringement and protect against unauthorised access.

Anti-piracy laws extend their reach to address the network of computers engaged in distributing counterfeit copies.

Actions for infringement are essential in rectifying breaches of software copyright laws, ensuring a fair and lawful digital landscape.

FAQs

What are the laws for software piracy in India?

In India, software piracy is primarily governed by the Indian Copyright Act, 1957, as amended in 1994. These provisions define and penalise copyright infringement related to computer programs. Additionally, the Information Technology Act, 2000, contains provisions against computer-related offenses, which can be invoked in cases of software piracy.

Is it illegal to sell pirated software?

Yes, selling pirated software is illegal. It constitutes copyright infringement and violates intellectual property rights. Engaging in such activities can result in legal consequences, including fines and imprisonment.

Is online piracy illegal?

Yes, online piracy is illegal. Uploading, downloading, sharing, or distributing copyrighted material without proper authorisation is considered copyright infringement. Laws against online piracy aim to protect digital content creators and rights holders.

Why piracy is illegal and wrong?

Piracy is illegal because it violates copyright laws and intellectual property rights. It is considered wrong because it deprives creators and industries of rightful earnings, undermines innovation, and compromises the integrity of the digital economy. Ethically, piracy is wrong as it disregards the value of creative work and fairness in the digital landscape.

How to prevent software piracy?

Preventing software piracy involves a multi-pronged approach, including robust licensing mechanisms, encryption, regular updates, legal enforcement, and user education. Employing technological measures and raising awareness about the legal and ethical consequences of piracy are crucial steps in deterring unauthorised software usage.

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