BUSINESS SOFTWARE ALLIANCE

PRESENTATION TO THE
BILLS COMMITTEE ON THE COPYRIGHT BILL
LEGISLATIVE COUNCIL
18 April 1997
By Mr. Emery Simon
BSA Vice-President – Policy
Executive Summary

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What is the Business Software Alliance?

The Business Software Alliance (BSA) is a non-profit trade organization that represents the world’s major software publishers. The BSA Policy Council focuses on law reform and policy issues. The members are Adobe Systems, Apple Computer, Autodesk, Bentley Systems, Computer Associates, Digital Equipment Corporation, IBM, Intel, Lotus Development, Microsoft, Novell, Sybase, Symantec and The Santa Cruz Operation.

The BSA position

It is an accepted fact that the rampant piracy of computer software in Hong Kong is stifling the local software industry. The introduction of a statutory decompilation right will be the final "nail in the coffin" for local software developers.

What is decompilation?

Decompilation is a term used to describe the process of converting a computer program from the form in which is used by a customer in a computer ("object code") to the form in which the computer programmer wrote it ("source code").

The source code is the essence of a computer program. Any computer expert who examines the source code of a program can determine what makes the program "good" and how it works. Unless permitted by law, the process of decompilation infringes copyright because it always involves making an unauthorised copy of the program.

Decompilation is almost always done because:

1. Decompiling is CHEAPER than obtaining a licence; and

2. Decompiling is EASIER than developing a new program from the beginning.

"Hidden" Piracy

In the process of disassembling or decompiling a computer program for reverse engineering, a competitor will get a rough copy of the source code. This is tantamount to stealing the blueprint of the software developer who has invested considerable effort and skill in writing and developing the software program.

Once an unscrupulous person has in his/her possession the source code of a software program, he/she can copy all functions of the program without replicating the code itself. He/she can therefore develop an identical program without incurring any of the development effort and expenditure of

the original software developer.

How will the introduction of a right of decompilation affect Hong Kong?

The introduction of a right to decompile goes against worldwide trends to strengthen copyright protection. In the five years since the European Union enacted its Software Directive, no other countries has followed its lead on decompilation. Most recently, the United Nation’s World Intellectual Property Organization, in re-writing international copyright law, considered and rejected provisions relating to decompilation.

Any jurisdiction with weaker copyright protection is less likely to attract foreign companies to invest development funds. This will have an adverse effect at all levels of Hong Kong society, as shown below:

What will be the Effect on Hong Kong’s international reputation?

Hong Kong Law Reform Commission Report

The Hong Kong Law Reform Commission Report on Reform of the Law Relating to Copyright (November 1993) recommended that a right of decompilation should not be introduced in Hong Kong.

The report states as follows:

"As to decompilation, we take the view that a limited right to decompilation is tantamount to creating another exception to infringement and we do not recommend any such limited right."

Since the report was published, no new arguments have been adduced to justify the introduction of such a right.

Do Other Countries Allow Decompilation?

See Figure 1:

Table – Which Countries Around the World Allow Decompilation.

Why has decompilation been raised in the Copyright Bill?

It is the understanding of the BSA that the reasons for introducing a right to decompile were as follows:

Ø To ensure interoperability between computer programs.

Ø To fall in line with the UK Copyright, Designs and Patents Act and the relevant European Council Directive.

Decompilation is not necessary for interoperability

The UK/European Union Experience

Only the member states of the European Community (EC) have enacted a statutory right of decompilation. This was a requirement of the EC Software Directive. The EC adopted the Directive because it was compelled to harmonise disparate, inconsistent, and in some instances, non-existent laws protecting computer programs.

The EC Software Directive is a unique response to a unique set of circumstances that do not exist and are not relevant to Hong Kong.

Conclusion

The removal of section 60 of the Copyright Bill in its entirety is in the best interests of consumers, the local software industry and the computer industry as a whole.

It will also re-affirm Hong Kong’s seriousness about promoting local software developers, as well as a commitment to copyright protection in the face of rampant software piracy.

FIGURE 1

TABLE:

Which Countries Around the World Allow Decompilation.

* An attempt to harmonize the disparate, inconsistent and (in some countries) non-existent laws protecting computer software. A unique response to a unique situation.

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