Every CD or DVD disc manufactured in the European Union would have to carry a unique code if proposals by media representation groups are adopted in the EU Enforcement Directive.

The proposal is contained in a five-point plan delivered to the European Union during a two-day piracy seminar in Madrid, under the auspices of the Spanish presidency of the EU. If adopted, it would enable the sources of pirated discs made in the EU to be tracked down, say the industry groups, which include the Business Software Alliance and the Motion Picture Association. Along with the unique code, called a Source Identification Code (SID), the groups want more powers that would enable them to demand information that would help them identify the original manufacturer or distributor of the infringing goods.

Other measures included in the proposals include, "genuinely deterrent penalties", a reasonable presumption of copyright ownership to avoid delays in court proceedings that in some cases allow pirates to escape justice, and more powers by copyright holders to seize and preserve evidence of piracy.

To back up their demands, the media groups claim that counterfeiting and piracy of copyrighted works "feeds a growing black economy in which criminal networks use piracy to fund other activities such as drug dealing, arms trading, money laundering and terrorism."

Dara MacGreevy, vice president of the Motion Picture Association, said the measures are necessary to tackle a convergence of Internet piracy and physical piracy fuelled by the falling cost of disc duplication technology. "Pirates are using the Internet to download illegal copies of movies and then burning them onto CD-ROMs or DVD Recordables," he said. MacGeevy cited a recent UK raid on a DVD-R factory turning that was allegedly making copies of Spider Man and Star Wars: Episode II movies. The raid netted over 10,000 discs and 31 DVD burners.

Lisa Peets, of law firm Covington and Burling, which acts as outside counsel for the BSA, was keen to dispel suggestions that SIDs could be a threat to civil liberties. "This would not allow us to track users," she said, "just the business where the disk was replicated." Peets noted that many disc manufacturers already use the codes, citing a figure of 80 percent.

Peets said the SID would be helpful in two ways. "First, it would be easier to identify illegitimate products -- CDs that don't have a code would raise a red flag. Second, would be easier to trace the source if each code is linked to the plant where it was made."

The software and media groups also want the process of being granted civil search orders (known as Anton Piller orders in the UK) to be made easier and cheaper throughout the EU. Some countries already make the process relatively easy, said Peets, but not all. "In some member states it costs 100,000 euros to obtain a search order, and in others it can take months to process the request, by which time there could be a leak," she said. The real problems occur when the industry group filing the order loses the element of surprise. "We had a case in France recently where we turned up at a company's premises with a search order, but they were one step ahead of us on every PC -- deleting the files before we could get to them," said Peets.

The higher fines and damages that the BSA and other media groups are pushing for would hit copyright infringers much harder than do current fines, as well as those buying counterfeit software, videos and songs.

"Part of the problem that rights holders face is that civil damages and criminal penalties on people caught infringing are often very small," said Peets. "So it means that a lot of these infringers make a business decision that based on the fact that it is cheaper to infringe and take the risk of getting caught." Under the proposals, infringers would be hit with "substantial" damages," said Peets. Other infringers, including companies and individuals who buy the counterfeit material, would be fined an amount equal to the retail value of what has been stolen. "Currently some courts may assess damages on the money that a counterfeiter has made," said Peets, "so a counterfeiter with a compilation of software worth $10,000 on one DVD but who sells it for $10 may be fined on the basis of that $10 profit."

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