BSA calls on govts to ensure that IT providers work with original software licenses

- Friday, May 27, 2011

BSA calls on govts to ensure that IT providers work with original software licenses

Governments throughout Latin America ought to require original software licenses from all government IT service providers, regional legal affairs director at Business Software Alliance (BSA), Montserrat Durán, told BNamericas.

According to Durán, if governments apply tougher rules to their own providers to avoid piracy, the private sector will be next to follow by demanding the same.

"It's like a chain reaction. Governments should be setting the example for other sectors," Durán said.

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Latin American piracy rates increased one percentage point overall in 2010, with 64% of software purchased being illegal copies, according to BSA's global software piracy report for last year.

And illegal software piracy results in tax evasion and intellectual property fraud.

"Those in charge of tax collection should be asking for original licenses; otherwise it's tax evasion. If we managed to reduce piracy by 10%, government coffers [in the region] will get more than US$1.6bn," she said.

So far, Colombia is the only country in Latin America with a law that makes it mandatory for all companies to show the authenticity of their software on their tax declaration. Failing to do so, they are charged not only with tax evasion, but also with intellectual property fraud.

"Legislation is key here, but the way the law is enforced is even more so. Most Latin American countries have signed international agreements against piracy, but they don't enforce it. Cultural levels are also part of the issue. You only need to look at the countries with the highest and the lowest piracy rate levels," Durán said.

Colombia and Brazil had the lowest piracy rate at 54%, followed by Costa Rica and Mexico at 58%. The latter three countries are also next in line to pass legislation similar to the law in Colombia, Durán said.

Venezuela leads the region in terms of piracy with a rate of 88%, one point higher compared to 2009, followed by Paraguay (83%); El Salvador, Bolivia and Guatemala (all at 80%); and Nicaragua (79%).

According to BSA's report, Latin America has one of the highest levels of piracy in the world, coming second after Eastern Europe. But it also has one of the highest rates of people who recognized that intellectual property should be protected and paid for.

"The problem here is not so much about individuals, but companies who think that it's okay to buy one software license and then install it on 40 computers. That's illegal," Durán said.

According to BSA, unlicensed software sales' total commercial value reached US$7.03bn in 2010 in Latin America - nearly US$1.00bn higher compared to 2009 and US$3.00bn when compared to 2008.