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Following is the speech by the Secretary for Trade & Industry, Mr CHAU Tak Hay, in moving the resolution on the Organised and Serious Crimes Ordinance (Amendment of Schedule I) Order 1999 in the Legislative Council today (Wednesday) (English translation) :

Madam President,

I move that the Resolution set out in the Order Paper regarding the Organised and Serious Crimes Ordinance (Amendment of Schedule 1) Order 1999 made by the Chief Executive in Council on October 12, 1999 be approved.

By including copyright piracy and trade mark counterfeiting offences under Schedule 1 to the Organised and Serious Crimes Ordinance (OSCO), the Order enables Customs and Excise officers to draw on the special powers available under the Ordinance to combat these offences.

Madam President, the overwhelming majority of the submissions we received in response to the public consultation exercise conducted early last year were in favour of more stringent legislation against piracy and counterfeiting offences, including the proposal to amend the OSCO. The proposal was also strongly supported by the Legislative Council Panel on Trade and Industry.

We consulted the Legislative Council Panel on Trade and Industry on the above Order last November. The Legislative Council subsequently decided to set up a sub-committee to study the Order. I am pleased that the sub-committee has decided to continue to support our proposal after detailed discussions. I would like to take this opportunity to express our appreciation for the efforts of Hon Selina Chow, the Chairman of the sub-committee, and other Members of the sub-committee.

In the course of our deliberations, an optical disc manufacturing association objected to the use of OSCO powers because of difficulties in verifying the authenticity of authorisations to produce optical discs. We believe that this does not constitute a valid reason to oppose stronger action to combat piracy activities.

Firstly, the amendments aim to tackle the more serious piracy and counterfeiting offences. Law abiding manufacturers should therefore have no cause to worry about being implicated. In addition, there is adequate protection in place under sections 118 (3) and (5) of the Copyright Ordinance, which stipulate that it is a defence for the accused person to prove that he "did not know and had no reason to believe" that the material in question was an infringing copy of a copyright work. Whether such a defence is accepted by the court will of course depend on the merits of individual cases.

Like other business activities, both parties engaged in a transaction should ensure the legitimacy of the transaction concerned. Thus an optical disc manufacturer is obliged to verify whether he has obtained proper authorization from the copyright owner before accepting an order. Furthermore, we understand that there are already well established practices whereby the authenticity of such authorisations is verified by copyright organisations. The major copyright organisations have also publicly undertaken to step up their support for optical disc manufacturers in verifying copyright authorisation documents.

As regards the proposal of the optical disc manufacturing association to set up a "centralised copyright registration system", it is neither feasible nor in line with international practices. This is because no registration system can cover all copyright works. Moreover, the international treaties that apply to Hong Kong stipulate that copyright should not be restricted by any obligatory registration requirements.

We appreciate that it may be more difficult to verify the authenticity of copyright authorisations of some Mainland works than those for works of other origins. In this regard, the Customs and Excise Department has already contacted the State Copyright Administration and the State Press and Publications Administration to enhance communications and to seek assistance in the verification process. We have reflected to the relevant Mainland authorities the difficulties encountered by the local optical disc industry and will discuss with them ways to simplify the verification process. The Trade and Industry Bureau will liaise with the optical disc manufacturers concerned and provide assistance as appropriate. Of course, optical disc manufacturers have to fulfill their own responsibilities under the law.

Finally, I would like to assure Members that the Customs and Excise Department will not exercise the powers under the OSCO lightly. This is because the Ordinance has laid down very stringent provisions on the application of its investigation and enforcement powers as well as the procedures for exercising such powers. For example, an application for a "witness order" under section 3 of OSCO could only be made to the court if law enforcement officers have sufficient reason to suspect that the offences concerned involve "organised crime" and have obtained the approval of the Secretary for Justice. It will then be up to the court to decide whether to grant such an order.

I now move that the Resolution to approve the Organised and Serious Crimes Ordinance (Amendment of Schedule 1) Order be adopted by this Council.

Thank you, Madam President.

End/Wednesday, January 12, 2000

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