CB(1)2070/04 05(13)
CB(1)2070/04-05(13)
Submission by
Cable and Satellite Broadcasting Association of Asia
to the Panel on Commerce and Industry
Hong Kong Legislative Council
Session on 19 July 2005
“Proposals on Various Copyright-Related Issues”
This submission is made on behalf of the Cable and Satellite Broadcasting
Association of Asia (CASBAA); we thank the Panel for the opportunity to present our
organization’s views.
Headquartered in Hong Kong, CASBAA is an industry association with
members and activities in 14 Asia Pacific markets. The Association is dedicated to the
promotion of multi-channel television via cable, satellite, broadband and wireless video
networks across the Asia-Pacific region and represents some 120 corporations, which in
turn serve more than 3 billion people. Member organizations include I-Cable, Galaxy
Satellite Broadcasting, PCCW’s now Broadband TV, HK Broadband Network,
Celestial Pictures, STAR Group, Time Warner, Turner Broadcasting International Asia
Pacific, Sony Pictures Television International, Discovery Networks Asia, National
Geographic Channel Asia, HBO Asia, MTV Networks Asia-Pacific, AsiaSat, APT
Satellite, IBM, Nokia, Sun Microsystems, HSBC, Standard Chartered Bank,
PricewaterhouseCoopers and Boeing Space Systems.
CASBAA participated actively in the Administration’s review of copyright-
related issues, and provided our views to the Commerce, Industry and Technology
Bureau on several different aspects of questions it posed. We are pleased to see, in the
Administration’s “Proposals on Various Copyright-Related Issues,” that a number of
the views we presented have been incorporated into legislative proposals.
We commend the Administration on its decision not to exempt hotel guest
rooms from paying copyright royalties for radio or television broadcasts, and we also
applaud its intention to seek legislation to make it a criminal offence to manufacture or
sell devices designed to defeat technological measures used by copyright owners to
protect their works against infringement.
However, we believe the provisions on circumvention of technological
measures do not go far enough. The Administration proposes to make possession for
use in business of such devices only a civil offense, and not to touch at all simple end-
user possession. This is in our view a serious error, which will continue to leave
confusion in the public mind of whether it is morally acceptable to steal copyrighted
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material, including television broadcasts. If the Administration’s proposals are
incorporated into law, they will send the message that possession and home use of
devices such as “hacked” set-top boxes which are designed to misappropriate a
continuing flow of copyright material is acceptable.
Forms of piracy against pay-TV copyright materials are many and varied, and
they are proliferating rapidly. Pirate enterprises take advantage of each new
technological development as it arrives, breaking encryption systems and using new
platforms such as digital transmission and internet rebroadcasts to diffuse “their”
product, often for profit. In many countries, these pirate enterprises are integral parts of
organized crime networks, and the profits from piracy are related to other illegal
activities such as narcotics smuggling and money laundering.
We conveyed to a July 11 hearing ob the Legco Panel on Information
Technology and Broadcasting our firm view on this issue: a person who installs a
circumvention device such as a “hacked” set-top box intends to fraudulently convert to
his own use, over an indefinitely long period of time, a series of digital signals which
are of substantial value, and which the owner of those signals has sought to protect
through encryption. Although the act is committed on private premises, it causes
damage to third parties, including copyright owners, broadcasters, advertisers, their
shareholders and employees. “Fraudulent conversion to his own use” is one of the
common-law definitions of stealing; the fact that such activity will affect the distributor
and the copyright owner’s interest in a continuing stream of products and that it
requires active circumvention of encryption safeguards clearly qualifies it as a theft that
warrants serious sanctions. (For the information of members of the Commerce and
Industry Panel, the full text of CASBAA’s July 11 submission is attached.)
In response to the growth of domestic pay-TV piracy, governments in other
developed jurisdictions in the Asia-Pacific region (including Japan, South Korea,
Singapore and New Zealand) have made end-user theft of subscription TV services an
offence against criminal law.
On June 30, 2005, Australia – the common-law country in this region whose
legal system is the closest to Hong Kong’s – announced that it, too, is legislating to
criminalise the act of dishonestly accessing pay-TV services. The Australian Attorney-
General, in making the announcement, commented: “The Government does not
condone pay-TV signal theft. People shouldn’t be able to get free and unauthorised
access to pay TV when other law-abiding Australians are paying for it. The proposed
laws will criminalise some unauthorised activities that are not currently criminal
offences, including dishonestly accessing a pay TV service in a private home.”
To achieve the goal of protecting subscription television services, we have
suggested amending Section 6 of the Broadcasting Ordinance to make all forms of pay-
TV piracy a criminal offence. The important goal is to send the clear message that theft
of intellectual property, and the resultant undermining of legitimate business, will not
be tolerated. It would also be highly useful to broaden the legislative proposal on
circumvention of technological measures for copyright protection to criminalise end-
user possession of circumvention devices; such a measure would also protect copyright
pay-TV material from alternative means of delivery in the digital environment.
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We have also urged the Administration and the Legco IT panel to act against
exhibition of foreign satellite signals in public venues, and we wish to repeat that
message today.
The review of the Copyright Ordinance provides an excellent opportunity to
address this commercial crime as well. Current law makes it possible for copyright
owners to pursue civil remedies against public venues using such unauthorized
broadcasts, and CASBAA and its members have launched a campaign to do so – and to
address the widespread misimpression that it is “all right” to use such overspill
broadcasts. However, such actions carry a high cost, and they must be endlessly
repeated. There is a regrettably high number of public venue operators who continue to
misuse overspill broadcasts; in some cases they do so even after having been formally
apprised of the legal situation and having given undertakings that they will not do so.
Clearly, the law’s more lenient treatment of these unauthorised foreign
broadcasts (as opposed to broadcasts authorized in Hong Kong, whose protection
against commercial misuse is enshrined in criminal law), has led to a very public
flouting of the copyright law. This is damaging in many ways, not least to efforts to
promote Hong Kong as a “clean hands” environment with a favorable investment
climate.
The clear message sent by the introduction of criminal sanctions against
commercial venues displaying unauthorised pay-TV signals – paralleling those already
in place for such venues misusing Hong Kong-authorized signals – would reinforce the
message that Hong Kong is “clean” and treats foreign investors on a level playing field
with domestic players.
Attachment: CASBAA Submission to Legco IT Panel, 7 July
Cable and Satellite Broadcasting Association of Asia
13 July, 2005
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Submission by
Cable and Satellite Broadcasting Association of Asia
to the Information Technology and Broadcasting Panel
Hong Kong Legislative Council
Session on 11 July 2005
“Domestic/Private Pirated Viewing of Subscription Television Programmes”
This submission is made on behalf of the Cable and Satellite Broadcasting
Association of Asia (CASBAA); we thank the Panel for the opportunity to present our
organization’s views.
Headquartered in Hong Kong, CASBAA is an industry association with
members and activities in 14 Asian and Australasian countries. The Association is
dedicated to the promotion of multi-channel television via cable, satellite, broadband
and wireless video networks across the Asia-Pacific region and represents some 120
corporations, which in turn serve more than 3 billion people. Member organizations
include I-Cable, Galaxy Satellite Broadcasting, PCCW’s now Broadband TV, HK
Broadband Network, Celestial Pictures, STAR Group, Time Warner, Turner
Broadcasting International Asia Pacific, Sony Pictures Television International,
Discovery Networks Asia, National Geographic Channel Asia, HBO Asia, MTV
Networks Asia-Pacific, AsiaSat, APT Satellite, IBM, Nokia, Sun Microsystems,
HSBC, Standard Chartered Bank, PricewaterhouseCoopers and Boeing Space Systems.
The issue of pirated viewing of subscription TV programmes is an important
one for our members. Our industry continues to grow rapidly, but its development is
seriously threatened by the theft of our members’ services. Unauthorized reception and
the use of pay-TV broadcasts in Asia are estimated to cost over US$900 million
annually. The estimated cost of pay-TV signal theft in Hong Kong in 2004 was
HK$194 million (US$ 24.9 million), a net revenue loss that neither the industry nor the
community at large can sustain.
Forms of piracy are many and varied, and they are proliferating rapidly. Pirate
enterprises take advantage of each new technological development as it arrives,
breaking encryption systems and using new platforms such as digital transmission and
internet rebroadcasts to diffuse “their” product, often for profit. In many countries,
these pirate enterprises are integral parts of organized crime networks, and the profits
from piracy are related to other illegal activities such as narcotics smuggling and
money laundering.
In response to the growth of domestic pay-TV piracy, governments in other
developed jurisdictions in the Asia-Pacific region (including Japan, South Korea,
Singapore and New Zealand) have made end-user theft of subscription TV services an
offence against criminal law.
On June 30, 2005, Australia – the nearest country with a common-law legal
system similar to Hong Kong’s – announced that it, too, is legislating to criminalise the
act of dishonestly accessing pay-TV services. The Australian Attorney-General, in
making the announcement, commented: “The Government does not condone pay-TV
signal theft. People shouldn’t be able to get free and unauthorised access to pay TV
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when other law-abiding Australians are paying for it. The proposed laws will
criminalise some unauthorised activities that are not currently criminal offences,
including dishonestly accessing a pay TV service in a private home.”
As we did with the Australian government, we urge the Hong Kong SAR
Government to consider carefully the international and moral dimensions of its
decision to legislate (or not) with regard to criminalisation of reception, access and use
of unauthorized subscription television signals.
The HKSAR should not leave a large loophole in its generally strong network
of intellectual property protection:
- A decision to criminalise the private appropriation of subscription television
broadcasts without proper payment will send a powerful message.
- Hong Kong, with its highly-developed legal system and advanced economy, sets an
example that is closely watched throughout the region. A decision by this developed
economy NOT to offer meaningful protection to the intellectual property of the pay-TV
industry will cause harm to the interests of content producers and distributors not only
in Hong Kong, but throughout the Asia-Pacific region.
- Hong Kong is a substantial producer as well as consumer of television (and other)
entertainment products. Hong Kong producers of programming are suffering severely
from piracy of their works in other regional jurisdictions. Hong Kong TV
programming is widely misappropriated, misused and uncompensated in other parts of
China, and in the countries of Southeast Asia. The only way for Hong Kong to achieve
an improvement in the way its own copyright works are treated is to set a high standard
at home. Continued Hong Kong inaction on criminalising this type of activity sets an
example that will contribute to a degradation in the IP climate for television throughout
Asia; this will multiply the resultant harm to Hong Kong producers of television (and
potentially other intellectual property) products.
- The HKSAR is anxious to encourage further growth of the pay-TV sector, with
additional investment in high-end, Hong Kong-based pay-TV platforms, as befits a
world city. Yet the pirating of signals - today or tomorrow - undermines the business
model of the legitimate platform operators and disincentivizes more investment.
- The subscription television industry – especially in Asia – is still in its formative
stages. Habits and attitudes are being established that will affect conduct (and industry
development) for decades to come. It is vitally important for the success of this
industry to encourage peoples throughout the region to make good choices, not
destructive ones.
No one contends that piracy of pay-TV signals in Hong Kong can or should be
stamped out by massive, intrusive invasions of private residential premises (though this
is one of the reasons frequently cited for not legislating in this domain).
However, it is important that the HKSAR adopts a consistent approach to all
unauthorized access and use of pay-TV broadcasts. We submit that in legislating in
this area, the government should seek to influence the moral decisions of private
citizens, at home and abroad, to demonstrate clearly that certain behaviors are
unacceptable.
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We note that in both the domestic and commercial domains, using an
unauthorized decoder is not a one-time act, even if any one program is viewed only one
time. A person who installs such a device intends to fraudulently convert to his own
use, over an indefinitely long period of time, a series of digital signals which are of
substantial value, and which the owner of those signals has sought to protect through
encryption. Although the act is committed in private premises, it causes damage to
third parties, including copyright owners, broadcasters, advertisers, their shareholders
and employees. “Fraudulent conversion to his own use” is one of the common-law
definitions of stealing; the fact that such activity will affect the distributor and the
copyright owner’s interest in a continuing stream of products and that it requires active
circumvention of encryption safeguards clearly qualifies it as a theft that warrants
serious sanctions.
Thus CASBAA believes that the appropriate remedy for such theft in Hong
Kong is to amend Section 6 of the Broadcasting Ordinance to make all forms of pay-
TV piracy, including both domestic pirated viewing of subscription TV programming
and the unauthorized use of satellite delivered “overspill” programming1, a criminal
offence. The important goal is to send the clear message that theft of intellectual
property, and the resultant undermining of legitimate business, will not be tolerated.
Hong Kong should not countenance theft, and neither should other legal
jurisdictions. That is the message our industry would like to see broadcast by a
decision to make all types of this behavior a criminal offence.
Cable and Satellite Broadcasting Association of Asia
7 July, 2005
1 The unauthorized distribution of satellite “overspill” programming within public venues (bars and clubs etc) is
particularly prevalent in Hong Kong because it is not a criminal offense. In addition to the damage this practice does
to the legitimate subscription TV industry, it represents unfair competition to the proprietors of bars that purchase a
legitimate commercial license to display these pay-TV services. CASBAA has taken legal action under existing
copyright laws, but these laws are not adequate to stamp out this practice.
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