Firms that do not stop employees downloading pirated software over the Internet at work could face fines, as the Business Software Alliance (BSA) plans a crackdown in 2003.

Mike Newton, campaign manager at the BSA in the UK, said the organisation will step up its campaign against Internet piracy next year, in response to the huge amount of software available for download via the Web. He warned that firms should take action to ensure that staff are not downloading illicit copies of software onto machines at work, as employers would be held liable. "Businesses give their employees access to the Web. If a rogue employee downloads illegal software, then it is a problem for the firm," Newton said.

According to the BSA, a quarter of software used within UK firms is not legitimate. To tackle the problem, the BSA offers rewards of up to £10,000 for tip-offs about firms running unlicensed software, and has set up an online self-auditing form, which companies can use to submit details of their software licences to the BSA. Once the BSA has verified the details are correct, it awards a Certificate of Recognition to participating firms.

The process of auditing software licences can save money for companies in the long term, advised Newton. "Under-licensing software can cost firms double the original amount they would have had to pay if they had purchased the correct number in the first place," he said.

Recently, Liverpool-based IT solutions company Amaze was fined £28,000 by the BSA, and had to pay a further £24,000 to purchase software licences to operate legally. "Firms caught under-licensing software also lose face as they are seen to be not managing their affairs properly and breaking the law," Newton said. The highest reward received by an informant so far this year has been £6,500, and the biggest fine was just under £100,000.

Maximum sentence

Firms are also at risk from stronger penalties for software piracy under the law, due to recent amendments to the 1988 Copyright, Designs and Patents Act. Under the changes, which came into force on 20 November, the maximum prison sentence for software theft has been increased from two to 10 years.

The amendments also give more powers to police to search premises, confiscate machines with unlicensed software and make arrests in copyright infringement and piracy cases.

To increase awareness about the risks of unlicensed software, the Institute of Directors (IoD) recently added a licence compliance section to its Web site. This offers firms advice on managing and auditing software licences, and explains legal obligations and consequences.

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