Will Trading Standards target IT chiefs?

Trading Standards will soon have new powers to police copyright, but will its remit stretch to software licensing?

Firms using unlicensed software could face greater risk of detection and prosecution from next month as new legislation extends the powers of Trading Standards officers to police software piracy and licence infringements.

But while the Federation Against Software Theft (FAST) has used the changes to warn that IT chiefs using unlicensed software could receive a knock on the door from Trading Standards officers and subsequent prosecution, the Trading Standards Institute (TSI) has said that it will not focus primarily on end users of unlicensed software.

The new powers, which take effect from 6 April, give Trading Standards officers the ability to police pure copyright as well as trade mark infringements. They have been given an extra £5m in funding and will have the power to raid premises where they believe there to be unlicensed software or other forms of pirated intellectual property, such as DVDs and music.

Robin Fry of legal firm Beachcroft LLP said that because the law makes no distinction between pirated software and unlicensed software the new powers should result in "much more powerful and vigorous enforcement" of software licensing violations.

However, Bryan Lewin, the TSI's intellectual property expert, said that although the new powers technically will give officers the right to pursue users of unlicensed software, they would primarily be used to target criminals dealing in pirated intellectual property. "We have the power now to start raiding places where [unlicensed] software is being used," he said. "But the focus will be on where people are manufacturing and selling [pirated software]. It's like counterfeit designer clothes - we go after the trader not the person buying a knocked-off handbag."

The TSI's position undermines recent warnings to IT chiefs from John Lovelock, director general of FAST, who claimed that "Trading Standards can now come knocking on your door, and you may be the subject of a criminal investigation. Very simply, the risk to organisations which misuse software will be greatly increased, and therefore compliance is absolutely essential".

IT Week this week learned that FAST agents have begun using the news of Trading Standards' extended powers to try to convince IT managers to enter a dialogue with the Federation – and ultimately subscribe to its software asset management services.

The TSI's Lewin said that FAST and other organisations are entitled to their view on how new powers will be used, but that it did not mean Trading Standards will definitely be involved in policing those areas. He added that companies guilty of software licensing violations will still be at risk of civil action from copyright owners.

John Benjamin of law firm Eversheds said regardless of the current debate over who should police licensing infringements, there is now an increased focus from government on intellectual property violations and that IT chiefs would be well advised to adopt best practices to limit the risk of running unlicensed software. "Any reputable IT director would have already taken steps to minimise the risk of licence violations," he said. "But those that haven’t need to realise there will be increased policing around intellectual property."