VZCZCXRO2156
PP RUEHCN RUEHGH RUEHVC
DE RUEHHK #1363 1420241
ZNR UUUUU ZZH
P 220241Z MAY 07
FM AMCONSUL HONG KONG
TO RUCPDOC/USDOC WASHDC PRIORITY
RUEHC/SECSTATE WASHDC PRIORITY 1679
INFO RUEHOO/CHINA POSTS COLLECTIE PRIORITY
RHEHNSC/NSC WASHDC PRIORITY

UNCLAS HONG KONG 001363 
 
SIPDIS 
 
SIPDIS 
 
STATE FOR EB/TPP/TA/IPC/FELSING 
STATE FOR EB/IPE 
STATE FOR EAP/M 
STATE FOR INR/EAP 
NSC FOR KTONG 
 
DEPT PASS USTR FOR SMCCOY, ACELICO, BAE 
DEPT PASS TO USPTO FOR TBROWNING 
 
E.O. 1298: N/A 
TAGS: CH ECON ETRD HK KIPR TW
SUBJECT: HONG KONG COUT OF FINAL APPEAL UPHOLDS BITTORENT 
CONVICTION 
 
¶1. (U) Hong Kong's Court of Fial Appeal upheld the 2005 
conviction and jail senence of Chan Nai-ming, the first 
person convicte worldwide for using the BitTorrent 
peer-to-peer (P2P) file sharing system to distribute illegal 
copies of films on the internet.  On May 18, the five-member 
court rejected the defense's argument that uploading films 
was a "passive" action that did not constitute "distribution" 
of infringing copies.  The judges also rejected Chan's claim 
that the distribution of infringing copies should be limited 
to "physical," not "electronic" distribution.  The judges 
held that electronic copies have protection under law without 
regard to the medium upon which they are stored.  Having 
exhausted all avenues of appeal, Chan immediately began 
serving his three-month prison sentence, which was 
significantly reduced as Chan is a first-time offender.  The 
maximum punishment is four years imprisonment and HK$50,000 
(approx US$6,400). 
 
¶2. (U) Stephen Selby of Hong Kong's Intellectual Property 
Department informed the Consulate on May 18 of court's 
decision and reiterated the HKG's efforts to clamp down on 
internet piracy.  Assistant Commissioner of Customs and 
Excise Department (CED) Tam Yiu-keung reiterated publicly 
that the court's decision is a strong deterrent against 
internet piracy and that CED would continue its 24-hour 
monitoring of infringing activity on the internet.  Margaret 
Fu of the Motion Picture Association (MPA) supported the 
decision, noting that the Court of Final Appeal sent a clear 
message that Hong Kong law enforcement authorities and 
prosecutors take intellectual property protection seriously. 
She explained that internet piracy alone costs the industry 
$US 7.1 billion in losses, approximately 40% of total piracy 
losses.  MPA noticed a sharp decline in infringing P2P 
activity in Hong Kong both after Chan's arrest and subsequent 
conviction.  MPA hopes that the Court's decision will once 
again serve as a deterrent to infringing P2P activity.  MPA 
stated publicly that it will expand educational outreach to 
inform Hong Kong residents of copyright laws and the ruling 
of the Court of Final Appeal. 
Cunningham