VZCZCXRO0872
PP RUEHCN RUEHGH RUEHVC
DE RUEHHK #1107 1680739
ZNR UUUUU ZZH
P 170739Z JUN 09
FM AMCONSUL HONG KONG
TO RUEHC/SECSTATE WASHDC PRIORITY 7865
INFO RUEHOO/CHINA POSTS COLLECTIVE PRIORITY
RHMFIUU/DEPT OF HOMELAND SECURITY WASHINGTON DC PRIORITY
RUCPDOC/DEPT OF COMMERCE WASHDC PRIORITY

UNCLAS HONG KONG 001107 
 
SIPDIS 
 
STATE FOR EAP/CM, EEB/IPE/TMCGOWAN, JURBAN 
DEPT PASS USTR FOR ALTBACH, RAGLAND 
DEPT PASS USPTO FOR TBROWNING 
GUANGZHOU FOR WONG 
 
E.O. 12958: N/A 
TAGS: KIPR PGOV ETRD ECON HK
SUBJECT: HONG KONG CUSTOMS BUSTS ASIA'S FIRST TOP-SITE 
 
¶1.  Summary:  Hong Kong Customs, working with local copyright 
associations, has for the first time in Asia taken down a 
"top-site".  These high-speed file sharing sites are the top 
of the digital piracy food chain, distributing the latest 
high-quality digital content through a highly secure network 
to members around the world who can then use more established 
channels to distribute content to end-users.  The action is 
yet another demonstration of the close and cooperative 
working relationship between Hong Kong law enforcement and 
international Intellectual Property rightsholders.   End 
Summary. 
 
¶2.  Hong Kong Customs and Excise (HKCE) announced June 15 
that it had uncovered an international copyright piracy 
syndicate that uses high-speed internet servers to distribute 
copyright-infringing items including movies, music, 
television programs, computer programs, and game software. 
HKCE arrested two local men and seized four computer servers 
with 11.6 terabyte capacity.  (Note: 1 terabyte equals 1000 
gigabytes and can store approximately 250 high-quality 
movies.)  The two men are currently free on HK$5000 (US$645) 
bail.  The maximum penalty for distribution of 
copyright-infringing work is four years imprisonment and a 
fine of HK$50,000 (US$6450) per infringing copy. 
 
¶3.  This "top-site" operated as a central distribution center 
for distributors of copyright infringing content around the 
world.  Membership to the &top-site8 was strictly 
controlled, with new members only able to join through 
existing members.  All members were actively uploading 
infringing materials, said HKCE Divisional Commander Michael 
Kwan, which would then be downloaded and distributed through 
other networks, including discussion forums, websites and by 
producing optical discs.  Most content was not kept on the 
"top-site" for long periods, and would typically be removed 
after about one month. 
 
¶4.  The syndicate took some care to avoid detection.  In 
addition to strictly limiting access, members were required 
to log in with a user name and password at a designated 
overseas IP address.  Logging in from a Hong Kong address 
would be rejected to evade detection by Hong Kong Customs.  A 
tip from the copyright industry representatives in March 2009 
led to a three-month undercover investigation by HKCE,s 
Anti-Internet Piracy Team and the June 9 raids against two 
Hong Kong locations.  HKCE officials believe the top-site had 
been operating for more than two years, with 200 active 
members in Taiwan, Hong Kong, Mainland China, Japan, Korea, 
India, Australia, the U.S., and Canada.  While enforcement 
action has been taken against similar &top-sites8 in other 
jurisdictions, HKCE said this is the first "top-site" 
detected in Asia. 
 
¶5.  Hong Kong-based International Federation Against 
Copyright Theft (IFACT), with major support from the Motion 
Picture Association of America (MPAA), confirmed they had 
provided information to HKCE to spark the investigation. 
IFACT Executive Director Sam Ho said the pirate syndicate is 
well-known in greater China as one of the more prolific and 
active infringing groups, and is particularly famous for 
their releases, many of which come with Chinese subtitles. 
 
¶6.  Ho said this "top-site" was used to distribute MPAA 
member companies products, including movies such as "Star 
Trek" and "Dragonball Evolution", popular TV series like 
"Lost" and "Prison Break", Bollywood, Chinese, and Hong Kong 
movies, Discovery Channel and BBC programming, and Xbox, PS2, 
PS3, and Wii games.  He praised the work of the HKCE 
Anti-Internet Piracy Team to take down the first "top-site" 
in the Asia Pacific region. 
MARUT