HONG KONG COUT OF FINAL APPEAL UPHOLDS BITTORENT

UNCLAS HONG KONG 001363 SIPDIS SIPDIS STATE FOR EB/TPP/TA/IPC/FELSING STATE FOR EB/IPE STATE FOR EAP/M STATE FOR INR/EAP NSC FOR KTONG DEPT PASS USTR FOR SMCCOY, ACELICO, BAE DEPT PASS TO USPTO FOR TBROWNING E.O. 1298: N/A TAGS: CH ECON ETRD HK KIPR TW SUBJECT: HONG KONG COUT OF FINAL APPEAL UPHOLDS BITTORENT CONVICTION ¶1. (U) Hong Kong's Court of Fial Appeal upheld the 2005 conviction and jail senence of Chan Nai-ming, the first person convicte worldwide for using the BitTorrent peer-to-peer (P2P) file sharing system to distribute illegal copies of films on the internet. On May 18, the five-member court rejected the defense's argument that uploading films was a "passive" action that did not constitute "distribution" of infringing copies. The judges also rejected Chan's claim that the distribution of infringing copies should be limited to "physical," not "electronic" distribution. The judges held that electronic copies have protection under law without regard to the medium upon which they are stored. Having exhausted all avenues of appeal, Chan immediately began serving his three-month prison sentence, which was significantly reduced as Chan is a first-time offender. The maximum punishment is four years imprisonment and HK$50,000 (approx US$6,400). ¶2. (U) Stephen Selby of Hong Kong's Intellectual Property Department informed the Consulate on May 18 of court's decision and reiterated the HKG's efforts to clamp down on internet piracy. Assistant Commissioner of Customs and Excise Department (CED) Tam Yiu-keung reiterated publicly that the court's decision is a strong deterrent against internet piracy and that CED would continue its 24-hour monitoring of infringing activity on the internet. Margaret Fu of the Motion Picture Association (MPA) supported the decision, noting that the Court of Final Appeal sent a clear message that Hong Kong law enforcement authorities and prosecutors take intellectual property protection seriously. She explained that internet piracy alone costs the industry $US 7.1 billion in losses, approximately 40% of total piracy losses. MPA noticed a sharp decline in infringing P2P activity in Hong Kong both after Chan's arrest and subsequent conviction. MPA hopes that the Court's decision will once again serve as a deterrent to infringing P2P activity. MPA stated publicly that it will expand educational outreach to inform Hong Kong residents of copyright laws and the ruling of the Court of Final Appeal. Cunningham