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MENAFN - Arab News - 20/12/2012

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(MENAFN - Arab News) The Saudi Ministry of Culture and Information has warned local businessmen that the United States is looking into the business practices of manufacturers in the Kingdom and other countries, to protect American companies and products from infringements.

"At both the state and federal levels, American government officials are taking action to ensure imported goods produced by companies in the Kingdom and other countries are using legal software in their business operations," Rafeik Al-Okaily, director of copyrights at the Saudi Ministry of Culture and Information, told Arab News on Wednesday.

He noted that the Kingdom has stepped up its campaign against piracy but it's possible that some local companies are still using illegal software in their business transactions.

Mohammed Al-Dhabaan, representative of the Business Software Alliance (BSA), said that software piracy in the Kingdom amounted to 51 percent in 2011, although the net effect of worldwide piracy was 42 percent.

This means that half of the programs that users installed last year were
unlicensed, according to BSA. The commercial value of this piracy was SR 1.68 billion in 2011, up from SR 128 million from the previous year. The move to prevent IT piracy began when Washington and Louisiana states passed new laws on piracy in early 2011. Preventive measures have been ampilified in recent months, through the high-profile support in the US House of Representatives, as the House's Small Business Committee urged the Federal Trade Commission (FTC) to find solutions to stop this phenomenon. In a landmark move, Massachusetts Attorney General Martha Coakley filed a lawsuit against a Thai seafood processing company last October. Coakley alleged that the company was undercutting food-processing prices by using pirated software to run its business, which was unfair to its American competitors.

In a settlement agreement, the Thai company acknowledged engaging in an unfair business practice and has been obliged to use legitimate software in its manufacturing operations. The Massachusetts settlement marks the first time an attorney general exercised authority to stop a foreign company from competing unfairly through unlicensed software use. The government wants to ensure local manufacturers and exporters are aware of the potential impact of this case.

The possibility exists that the Massachusetts attorney general action may trigger similar actions in other states.

Many Saudi companies are supportive of the effort to stop software piracy, particularly those who take pride in competing fairly, according to Al-Dhabaan.

"In the 21st century, IT is at the core of business. It makes good business sense to play by the rules and license IT, and if it gives me a competitive, ethical advantage when entering big markets like the United States, then it is all the better. I proudly stand by what I produce, so competing fairly is the only way to go," Al-Dhabaan said.

He noted that the focus on stopping IT theft as a way to safeguard US jobs gained international attention when the US-based National Association of Attorneys Generals (NAAG) addressed the issue in November 2011.

At that time, he said, attorney generals from 36 states and three US territories urged the Federal Trade Commission (FTC) to use its authority to protect American businesses and stop unfair competition caused by pirated software.

These new acts related to unfair competition in the United States, may affect Saudi companies that export their products to the American markets. If these manufacturers are unaware of the risks of using pirated software, they might be banned from entering the American markets and face lawsuits.

It is important for Saudi manufacturing companies to be aware of these new developments in American laws, especially since they might have a direct impact on their sales and export capabilities to the US.

Software piracy is now entering a new era where legitimate rights are gaining additional enforcement powers.


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