The Federal Court has established the right of Sony PlayStation owners to have their games consoles 'chipped'.
"Chipping allows consumers to modify their PlayStation console to play imported and copied games", ACCC Chairman, Professor Allan Fels, said today.
"Sony Computer Entertainment Australia was unsuccessful in its attempts to have the new anti-circumvention provisions of the Copyright Act 1968 interpreted to outlaw the installation of modification chips which overcome region coding restrictions.
"Australian consumers can now enjoy games legitimately bought overseas, as well as authorised backup copies, by legally having their games consoles chipped", he said.
The region coding which exists in PlayStation consoles lets Sony to produce and distribute PlayStation games globally according to three mutually exclusive regions. It effectively prevents games produced in one region from being played on a console manufactured for a different region. These regional restrictions can be overcome by the installation of a 'mod chip' which allows consumers to use PlayStation games from all regions, irrespective of the region for which the console was produced.
The recently enacted Section 116A of the Copyright Act makes its illegal to make a device or supply a measure that is designed to overcome copyright protection measures providing that those copyright protection measures have no commercially significant purpose other than to protect copyright. The Court upheld the ACCC's submission that the copyright protection measures go beyond having such a single purpose.
"The ACCC has long believed that region coding is detrimental to consumer welfare as it severely limits consumer choice and, in some cases, access to competitively priced goods. The ACCC was concerned to ensure that technology which can overcome these unfair restrictions remains generally available for consumers' use.
"The case involved a particularly complex area of intellectual property law, the provisions of which were previously untested in Australia.
"The proceedings were taken by Sony against an individual involved in chipping PlayStation consoles and selling unauthorised copies of PlayStation games. The individual was unrepresented at trial. The ACCC was granted leave of the Court to be heard as a friend of the Court (amicus curiae).
"It is clear that Sony was in a much stronger position than the individual respondent to persuade the Court as to the correct interpretation of the Copyright Act. In such circumstances the ACCC felt it entirely appropriate to assist the Court by objectively putting to it alternative meanings", Professor Fels said.
"Sony vehemently contested the proceedings once the ACCC became involved as a friend of the court. It was only once the ACCC sought to challenge the company's vague arguments regarding the operation, purpose and effect of region coding that Sony attempted to persuade the Court of the merits of its position with no less than four alternative arguments as to why chipping is illegal under the Copyright Act. None of Sony's arguments regarding chipping were accepted by the Court".
Sony failed to convince the Court that region coding exists to prevent copyright infringement. The Court accepted that the effect of region coding is to restrict the playback of certain games, noting that the Copyright Act does not make it illegal for consumers to play computer games, only to copy them illegally. The Court further noted that the region coding does not serve the purpose of preventing or inhibiting the copying of games, and was therefore not worthy of protection under Australian copyright laws.
Sony was successful in establishing that the individual had sold unauthorised copies of PlayStation games.
NB: Professor Fels will be available at 12.15 p.m. today to demonstrate the effect of 'chipping' on Australian consoles at the ACCC's Melbourne offices, Level 35,
360 Elizabeth Street, Melbourne.
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