New copyright legislation will turn up the heat on businesses using unlicensed software, according to a leading UK lawyer.
The Copyright and Trade Marks Act 2002, which was was given Royal Assent at the end of July, is aimed at combating the growing piracy and counterfeiting industries.
But Rachel Burnett, a partner at IT law firm Bristows, said that the Act would also hit businesses using unlicensed software, and would strengthen existing laws governing use of software including the Computer Misuse Act 1990 and the Copyright, Designs and Patents Act 1988.
The new Act will bring the maximum penalty for copyright theft from two to 10 years for businesses making unauthorised copies of copyrighted works, and will also rationalise the use of search warrants.
"Directors shouldn't worry unduly - they don't normally get sent to prison for corporate manslaughter, let alone for copyright offences. If the companies are deliberately making profits out of unlicensed software that is one thing, but IT directors are not typically going to get sent to prison," Burnett said.
"It may be difficult for some businesses to check up on the business-wide use of all their software, but they ought to be doing so for three reasons: to ensure that they are not paying out more in licensing and support fees than they should be; to be commercially aware of what they have available to them, whether software, machinery, or other resources; and to comply with the law," she added.
The western European software industry lost $2.7bn in 2001 due to illegal software, according to estimates from the Business Software Alliance.
But senior management awareness of under-licensing and piracy is growing, according to the latest Software Licensing Survey from the Federation Against Software Theft (Fast).
The survey of 2,500 UK organisations found that 56 per cent now consider software compliance to be a board level issue, compared with 19 per cent one year ago.
But 40 per cent still do not have IT policies in place to manage software compliance, which means the liability associated with non-compliance rests solely with the company directors. Taking legal action against any employee that breaches them would therefore be impossible.
Paul Brennan, general counsel at Fast, said: "People tend to keep their heads in the sand. But we have a hotline that receives 1,000 calls a year, a lot of them from employees. We recovered £1.5m last year. The message is getting through that software under-licensing is really not worth it."
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