Trading Standards officers in Cardiff will begin random searches of businesses later this year in an attempt to stamp out the illegal use of software.
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They will be the first to use new government powers , to enforce software copyright. The project could set the pattern for similar programmes throughout the rest of the UK
Trading Standards Officers and the Federation Against Software Theft (Fast), an industry body, have presented the pilot programme as educational rather than punative, but businesses have raised concerns about the way the powers will be used.
Business organisations were alarmed last year when the government gave Trading Standards (TS) the power to enter workplaces without a warrant or prior notice, carry out criminal investigations, and hand over offenders to the authorities for prosecution.
Critics denounced the involvement of Trading Standards as misuse of public funds and its powers as heavy-handed, unfair and potentially disruptive to business, particularly smaller enterprises.
Software licence inspections at large businesses will be a waste of time and money as most manage software as an asset as part of standard good business practice, says Corporate IT Forum chief executive David Roberts.
And the Federation of Small Businesses says there are too many government agencies with power of intrusion and inspection for small business owners to be able to keep up.
"Often business owners are taken by surprise and may be breaking the law completely unwittingly without knowing what the issue is," says the federation's Simon Briault.
Misuse of resources
The government plan is a misuse of public resources, says Peter Sommer, cybercrime specialist at the London School of Economics.
"Trading standards should be protecting the public from dangerous and fraudulent goods and not protecting the interests of software companies," he says.
Trading Standards officers in Cardiff are to work with the Fast to advise around 100 businesses selected for the programme on the legal and security risks of using pirate software.
Fast is also working with Trading Standards to finalise an auditing tool to extract information about software installations in a forensically sound way, which will have to be finalised before inspections can begin.
This is likely to be an appliance officers can plug into company computer systems to extract information about software installations.
Each of the selected companies has been sent a set of guidelines drawn up with Fast on how to comply with copyright law by checking what software they have and ensuring it is properly licensed.
The programme is aimed at helping businesses avoid legal action and they will be notified of inspections to give them time to prepare, says Handley Brustad, senior Trading Standards officer in Cardiff.
Although Trading Standards has the power to hand over offenders for prosecution, Brustad says this will be done only after a full and detailed investigation has established copyright was infringed intentionally.
"Where it is done unintentionally or unwittingly, we will help businesses to get properly licensed and go after the suppliers of the counterfeit or unlicensed software," he says.
Part of the education programme will be aimed at showing businesses why it is important for them to know exactly who has supplied their software.
Brustad defends the involvement of Trading Standards in policing copyright infringement by saying the agency is charged with protecting consumers and business, which includes protecting their intellectual property rights, regardless of the size of company.
"We can't draw a line and say that when a company gets to a certain size we are no longer going to protect their product," he says.
Trading Standards Cardiff and Fast will use the pilot to come up with a best practice approach which will be shared across the UK.
It is not certain this will be used as a model for future policing of software copyright infringement by Trading Standards on a national basis, but indications are that business will favour a more measured approach.
Jeremy Beale, head of knowledge content at the CBI says, "What is important about this initiative is that it is not just a stick approach, but a carrot and stick approach."
He says it would be wrong to introduce surprise inspections without first taking steps to ensure businesses know what they need to know and have the opportunity to comply.
Businesses will be able to judge the positive effects of the pilot on the Trading Standards national programme of software inspections only once it begins, but that is not likely before 2009.