Piracy

The act of making illegal copies of video tapes, computer programs, books, etc, in order
to sell them.

Literature Review;

Moral rights are rights of creators of copyrighted works generally recognized in civil law
jurisdictions and first recognized in France and Germany, before they were included in
the Berne Convention for the Protection of literally and Artistic Works in 1928. Some of
the moral rights are copyright, patent, trademarks, industrial design rights, utility models,
geographical indication, trade secrets, related rights, trade names and domain names.1

Intellectual property is an intangible property, which, against other forms of property, cannot be
defined or identified by its own physical parameters. Four separate and distinct types of intangible
property; namely, patents, trademarks, copyrights, and trade secrets collectively are referred to
as intellectual property.2

A license is a permission to use a resource claimed under intellectual property laws, often
against a royalty fee. ‘Piracy’ is an industry label for the unauthorized use of that
resource.3

Pakistan is a member of the Berne Convention on copyrights and the World Intellectual Property
Rights Organization (WIPO), but is not a member of Paris Convention for protection of intellectual
property.4

Pirated products are sold in almost all the economies of the world but its consumption is
different. For example, automotive parts market in Middle East and pharmaceuticals in
Africa. Piracy of music, movies and software appears to be significant in all economies,
especially developing countries.5

1
: Peter E. Berlowe, Laura J. Berlowe-Heinish, and Peter A. Koziol, 81 Fla. Bar J. 30
(2007)
2
: Lawrence R. Hefter and Robert D.Litowitz, ‘What is Intellectual Property’? US State
Department Study, at www.us.gov.ipr.htm.
3
Martin Kretschmer, Issue Paper for SSRC “Intellectual Property, Markets, and Cultural
Flows” New York, 24-25 October 2003
4
: European Commission’s market Access Sectoral and trade Barriers database. See Pakistan-
IPR Related Measures at http//www.europa.eu.int

5
John Dryden ,Deputy Director for Science, Technology and Industry, OECD, Paris,
Third Global Congress on Combating Counterfeiting and Piracy 30-31 January 2007,
International Conference Center, Geneva
Presentation for the Third Global Congress on Combating Counterfeiting and Piracy, 30-31
January 2007, International Conference Center, Geneva, Switzerland.
The higher price earning ratio gives rise to demand of pirated products which gives rise
to a black market opportunity and raises expected profit for smugglers and distributors of
pirate products. The higher level of piracy market share is due to expected profits in the
market. Higher the level of corruption and black market activity, higher the level of
piracy.6
Economic inequality is important variable to have negatively affected national piracy rate.
Effective Judicial system of a country also affects piracy rate but they are not the only factors
which affect piracy rate.7

Higher costs of original software are compelling towards piracy. The cost of original product has
the key factor in using pirated products.8

The high prices of foreign books are the main cause of piracy in Pakistan. Preventing
piracy can only be a success until low priced books are available to local readers.9

Four indicators which may have significant impact on piracy are

1. economic,
2. technical,
3. regulatory, and
4. social/cultural
But these are not the only factors which determine piracy. Furthermore
countries which have less corruption rate have low rate of piracy.
Factors such as strong economic growth, low trade regulations, high
uncertainty avoidance, low Internet use, better ICT laws, and strong IT
infrastructure had partial influence on low piracy.
The study explains 78% (1996) to 84% (2001) to 83% (2003) of increase in software
piracy data. Economic factor is not the only factor which determines high piracy rate as
piracy is prevalent in more developed counties as well. Social structures and attitudes
should also be changed in order to decrease piracy.10

Text shortened for delivery. It will be available on the OECD web site at
www.oecd.org/sti/counterfeiting.
6
: Papadopoulos, Theo, (2003) "Determinants of International Sound Recording Piracy."
Economics Bulletin, Vol. 6, No. 10 pp. 1−9, August 7, 2003.
7
: Andrés, Antonio Rodríguez, Applied Economics Letters pp. 101-105(5), Volume 13, Number
2, Number 2/10 February 2006 ,
8
: Eric Kin-wai Lau, Factors motivating people toward pirated software, Qualitative Market
Research: An International Journal Volume: 9 Issue: 4 Year: 2006
9
: Khalid Mahmood, Muhammad Ilyas , IFLA Journal, Vol. 31, No. 4, Pp:324-332
(2005)
10
Kallol Bagchi, Peeter Kirs, and Robert Cerveny, COMMUNICATIONS OF THE ACM
June 2006/Vol. 49, No. 6
The global software piracy study, conducted annually for the last decade by the Business
Software Alliance, a trade group, showed a worldwide rate of 36 percent last year, amounting to a
loss for the software industry of $29 billion11.

It’s not really difficult to supply pirates with legitimate products at cheap prices
legitimizes the pirate networks; turning pirates into conventional points of purchase
(POP). This benefits all parties and provides a new, yet established, outlet. Time Warner
and Twentieth Century Fox have both met with success having implemented this scheme
in China, though the inability to find legitimate Western DVDs and the low wages in
China have also been influential factors.12

Audiocassette piracy and book piracy (mainly photocopying of medical texts,

Computer books, and business titles, but also including reprints piracy and commercial
photocopying) continue to cause serious commercial harm to copyright owners in
Pakistan. For example, pirate audiocassettes sell for as little as seven cents in Pakistan;
not surprisingly, it becomes difficult in the face of such pirate prices to develop a
legitimate local market. Piracy of international and regional (Indian) sound recordings
continues to be nearly 100%, while the overall rate of piracy is estimated at 90% (no
change from 1999). U.S. publishers report that the piracy situation in Pakistan continues
to plague legitimate sales as the problem of illegal reprinting and commercial piracy of
scientific, technical and medical titles increases. Computer and business books also
continue to be popular with the pirates.13

Pakistan has become one of the world’s leading producers and exporters of pirated optical
discs (CDs, DVDs, VCDs, and CD-ROMs) of copyrighted sound recordings, motion
pictures, business and entertainment software and published materials. Eight known
facilities in Pakistan produced upwards of 180 million discs in 2003, nearly all illegal;
most are being exported around the world to at least 46 other countries. Book piracy also
remains a serious problem in Pakistan, and other types of piracy (e.g., end-user piracy of
business software) must be addressed by the government.14

11
: Chris Oakes, International herald tribune Business, THURSDAY, JULY 8, 2004
12
The Wysiwyg Team, Www. wysiwygfilms.com, Wednesday, May 16th, 2007
13
IIPA GSP Petition on Pakistan June 13, 2001 Page 6
14
IIPA Press Release on USTR 2003 GSP Review Results, page 2