Global Economics

MEPs Okay Law Criminalizing IP Theft


EU parliamentary committee backs draft report on criminal penalties, including prison, for breaches of intellectual property rights

A proposal for the EU's first-ever directive harmonising criminal law in all member states has been backed by MEPs as they voted for a draft report on criminal penalties - including imprisonment - for crimes breaching intellectual property rights.

Members of the European Parliament's legal affairs committee on Tuesday (20 March) adopted Italian socialist MEP Nicola Zingaretti's draft report on "criminal measures aimed at ensuring the enforcement of intellectual property rights."

The report comes after the European Commission in April 2006 put forward a proposal for an EU-wide law in the area.

According to the commission, the range and value of pirated goods - from fashion bags to sports cars and from music files to fake medicine - is on the rise in the EU and increasingly linked to organised crime.

"We are opening a new chapter of our activities. This is the first directive we are voting on where we are having a directive with a penal code," said Mr Zingaretti immediately after the vote.

"At the moment the EU wants to issue a positive text, which introduces an important novelty of harmonisation of the penal code," he added.

If the report goes through both the entire parliament and the member states, the proposed law would oblige the 27 EU capitals to make all intentional violations of intellectual property rights carried out on a commercial scale a criminal offence.

As a deterrent, the text proposes measures ranging from fines to imprisonment, according to the gravity of the crime.

Mr Zingaretti's report backed the overall aim of the commission proposal, but excluded patent rights from the scope of the directive, and decided that criminal sanctions should only apply to those infringements deliberately carried out to obtain a commercial advantage.

Piracy committed by private users for personal, non-profit purposes are therefore also excluded.

Under the law, the maximum penalty must be at least €300 000 and/or four years' imprisonment and, in some cases, remedies can include the seizure and destruction of counterfeited goods.

This first move by Brussels into criminal matters was made possible by a landmark ruling on environmental crimes by the European Court of Justice in September 2005, which gave Brussels the power to introduce harmonized criminal laws across the EU.

The court stated that the commission is allowed to propose penal measures in order to make community legislation effective.

However, far from all agree that criminal law should be a competence of the EU. Austrian green MEP Eva Lichtenberger who voted against the draft report said the result was "rather unfortunate."

"It impinges on an area of criminal law where I feel it is not a good idea for us to meddle," she said about the proposed directive.

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