R.A. 10372 and the Misconceptions of Malacanang

“The Smuggler is a person who, though no doubt highly blamable for violating the laws of his country, is frequently incapable of violating those of natural justice, and would have been in every respect an excellent citizen had not the laws of his country made that a crime which nature never meant to be so.”

-Adam Smith

The Cultural Appeal of Smuggling and Piracy

In many countries around the world, smugglers and bootleggers and other “dregs of society” have been idolized by their people as legends and folk heroes. John Hancock, one of the famous signatories of the American Declaration of Independence, and attributed to the word “Hancock” as a synonym for signature, was a famous smuggler when the British imposed heavy taxes on rum and molasses

[1]. During the Prohibition Era of the USA, many heroes and legends were created by daring bootleggers and gangsters who continually defied the government at the time, just look at the movie Public Enemies which was about famous bootlegger and gangster John Dillinger or The Untouchables which portrayed a squad sent to take down Al Capone. Their essence boils down to this, “Government tyrants want to either prevent or interfere with peaceable voluntary exchange among individuals. I can reduce the impact of that interference.”[2]Who wouldn’t want to lessen the price of goods? It is inherent in human nature. Although it is illegal, it isn’t necessarily immoral in and of itself.People will always look after their own welfare, and if that means being able to pay less on their goods, then so be it. Expensive goods are just as bad as prohibiting them outright, because in either case, there will always be people who will find a way to make these goods affordable and available to the general public, legally or illegally, through smuggling or in this situation, through piracy. The modern day smugglers and bootleggers of the digital generation are the pirates of Pirate Bay[3] and Demonoid[4], the hunters of ISO[5], and the Greenhills pirated software ladies[6]. These people have a strong following in the youth, and are largely backed by many big dot-com companies. They have provided free software and movies to those people who cannot afford the hefty and absurd pricetags (just look at the price for the newest version of Adobe Photoshop). There was a reason why they have generated so much media attention and so much strength of arms around the world when governments such as the USA have tried to take them down. These sites and their operators are the modern day folk-heroes of the digital generation, the bootleggers of software, the crackers and the hackers. And the products of these people are the ones causing problems for the government and the IP companies. Without their help, many Filipinos would not even be introduced to the digital age, since the prices of software are the largest barriers to entry.

Piracy as a Filipino Fact of Life

And with this in mind, imagine the Philippines and the current situation of the majority of its people. Many of them now require access to computers and software to do their daily work, whether its word processing, presentations, or just accessing the internet. Then look at the average monthly wage of a Filipino, which is $279[7] (PHP 11,160[8])and at the bottom 3 out of 72 countries. Compare that figure with the price of Microsoft Windows 7 Home Premium, valued at $169.99[9] (PHP 6,799.6) or even Microsoft Office 2010 at $179 (PHP 7160). The prices of these necessary software alone eats up more than two-thirds of a Filipino’s average monthly wage.The movie industry is no different, with ticket prices ranging in the PHP 180 – 250 segments, while the Philippine’s average salary is only slightly below NCR’s minimum wage of PHP 460. Movie tickets then cost around half what the average juan earns in a day, while their pirated equivalents cost only PHP 30-50 per DVD, and allows them to watch it as many times as they want. That basically sums up the issue of intellectual property piracy in the Philippines.

Malacanang’s Own Take on R.A. 10372

With the advent of the amendments[10] to the Intellectual Property Law[11] the scene has changed in the country, towards piracy and towards pirated material. The problem encountered with these amendments came when certain private sectors misinterpreted RA 10372, spreading these misconceptions quickly through social networks such as Twitter and Facebook. This prompted action from Malacanang by issuing a press briefing headed Intellectual Property Office Director General Ricardo Blancaflor to clarify these misconceptions[12]. Some of the topics misconstrued by the public were that “jailbreaking” or bringing home DVD’s or books abroad were made illegal. The crux of this paper lies in determining if the Palace’s interpretation of Republic Act 10372 is actually accurate in purveying its meaning through its publishing FAQ found on their website[13] or if the Palace themselves created their own misconceptions on the new law.

  1. I.                   Am I still allowed to import books, DVDs, and CDs from abroad?

Yes. In fact, the amendments to the Intellectual Property Code have removed the original limitation of three copies when bringing legitimately acquired copies of copyrighted material into the country. Only the importation of pirated or infringed material is illegal. As long as they were legally purchased, you can bring as many copies you want, subject to Customs regulations.”

Previously, under the Intellectual Property Code, the importations of these works were severely limited by Sections 190.1 and 190.2 of the Code. They read together as limiting the number of copies of a work an individual may “import” to three onlyas stated, “When such copies form parts of libraries and personal baggage belonging to persons or families arriving from foreign countries and are not intended for sale: Provided, That such copies do not exceed three (3).[14]

When it was amended by Section 14 of R.A. 10372, deleting Sections 190.1 and 190.2 and renumbering Section 190.3 as Section 190, it purportedly removed this limitation on the importation of copyrighted works. This void on the subject of importation does not automatically mean that OFW’s can bring in as many legally-purchased copyright works as previously stated by the Palace’s FAQ, but created a grey area that leaves a gap that seems to have to be filled by the Implementing Rules and Regulations of the law. And insufficiencies or defects in the law cannot be cured by simply amending them in the IRR.

The more suitable take on the law is just to apply “CassusOmissus Pro OmissoHabendusEst” or simply the principle ofCassusOmissus. This means that the limitations on bringing in of copyrighted works by Balikbayans have been intentionally omitted by the legislative body. Thus this deliberate omission will have removed the limitations on the number of copyright works a Filipino may bring back home, subject to Section 190 as amended. This remains highly debatable but unless it is assailed in an actual legal controversy and brought to the Supreme Court, then it will only be conjecture and the word of IPO Director General Blancaflor.

  1. II.                Is the reproduction of copyrighted material for personal purposes punishable by this law?

No. Infringement in this context refers to the economic rights of the copyright owner. So, if you transfer musicfrom a lawfully acquired CD into a computer, then download it to a portable device for personal use, then youdidn’t commit infringement. But if, for example, you make multiple copies of the CD to sell, then infringement occurs.

The problem with R.A. 10372 is that it amended Section 212[15] of the Intellectual Property Code which limited the rights of performers, artists, and producers. It did not allow Sections 203, 208, and 209 of the Intellectual Property Code to apply to individuals who use and reproduce these works for their own purposes only. This means the IPC would allow an individual to do what he pleases as long as it is for personal use, and not for commercial use, and this includes reproducing the works for personal use.

When Section 212 was amended, it took away these limitations and is now the complete opposite of what they have posted in their FAQ regarding the above query. Section 212 as amended now gives performers and producers unlimited rights over their work, and this includes their rights over your copy, even if it is for personal use, if they violate Sections 203, 208, and 209. These previously enumerated sections are the rights of performers and producers, and since they are not limited anymore by the “personal use” provision, they can sue if these rights have been violated according to their Economic Rights under Section 177.

Therefore, although the “reproduction of work for personal use” was not expressly punished under R.A. 10372, it deleted the limitations on the law that gave protection for “personal use”, thus leaving the issue very open and depriving the users of an express provision of law that protected their right to personal use.

  1. III.             Is the possession of, for example, a music file procured through an infringing activity a violation of this law?

“Only if it can be proven that the person benefitting from the music file has knowledge of the infringement, and the power and ability to control the person committing the infringement.”

This goes to the crux of file-sharing and torrenting. Downloading music files from torrent sites and P2P file-sharing software has long been an issue for Intellectual Property Laws around the world. The most absurd cases have arisen in the USA, where many of these recording companies are based. A mother of four was charged with downloading illegal music and sentenced to pay $ 1,920,000 to record companies and the RIAA[16]. It seems that R.A. 10372 Section 21, which amends Section 212 of the IPC will end up with the same results here. Why should the costs of downloading music, of simple entertainment, be worth more than some damages and fees awarded to victims of actual physical crimes of violence and inhuman conduct?

In fact, as contradicting the statement of Director General Blancaflor, the knowledge of infringement is immaterial to the case, because at the most, no knowledge of the infringement MIGHT, BY THE COURT’S DISCRETION, reduced the amount to a “mere” PHP 10,000[17].

  1. IV.              Is jailbreaking or rooting my phone or device illegal?

“No. Jailbreaking or rooting by themselves are not illegal. However, downloading pirated material, or committing infringement with a “jailbroken” phone increases the penalty and damages imposed on the person found guilty of infringement.”

Under R.A. 10372, Section 185 of R.A. 8293 as amended reads as “…Decompilation, which is understood here to be the reproduction of the code and translation of the forms of a computer program to achieve the interoperability of an independently created computer program with other programs may also constitute fair use under the criteria established by this section, to the extent that such decompilation is done for the purpose of obtaining the information necessary to achieve such interoperability” and clearly Jailbroken phones fall under this definition. Thankfully, this fails under the Fair Use of a Copyrighted Worksection of R.A. 8293, which means that Director General Blancaflor is actually correct in this case and that it does escalated the violation if caught infringing intellectual property, like that of an aggravating circumstance. Although there is no actual reason why jailbreaking a phone needs to be treated as an aggravating circumstance, the law still increases the penalty.

  1. V.                 Are mall owners liable for infringement activities of their tenants?

“Mall owners are not automatically penalized for the infringing acts of their tenants. When a mall owner or lessor finds out about an infringement activity, he or she must give notice to the tenant, then he or she will be afforded time to act upon this knowledge. As stated above, the law requires that one must have both proven knowledge of the infringement, and the ability to control the activities of the infringing person, to be held liable. The mall owner must also have benefitted from the infringement.”

As IPLDG Blancaflor states, the mall owners are not “automatically penalized” for the infringement. But in Section 216, as amended by R.A. 10372, it makes no distinction for those under paragraph (b) of Sec. 216, which states, “Benefits from the infringing activity of another person who commits an infringement if the person benefiting has been given notice of the infringing activity and has the right and ability to control the activities of the other person;”. This means that the malls must always be on the look-out for those tenants who do violate the IPC, but that gives undue responsibility to them, because violators will always find a way around the systems, and these should not be the sole responsibility of the land lords. Furthermore, as reiterated previously, the law also punishes those who did not know of the infringement but were involved nonetheless, knowledge be damned.

  1. VI.              Is it legal for the Intellectual Property Office (IPO) to visit businesses to conduct searches based on reports, information, and complaints?

“The IPO may visit establishments based on reports and complaints; this in itself is constitutional. However, if the IPO intends to perform a search and seizure, it must comply with constitutional requirements, such as having a search warrant. A warrant wouldn’t be required, however, if the IPO is accompanied by the Bureau of Customs or the Optical Media Board—two agencies that can perform a search and seizure on their own right without a warrant (per Republic Act No. 1937 and 9239, respectively). The procedure and safeguards for this are to be spelled out in the Implementing Rules and Regulations.”

The troubling effect of the visitorial powers conferred to the Director General of the Intellectual Property Office is that it gives them the power to make summary judgement on violators, without due process of law. The offending section can be found in Section 7 (d) of R.A. 8293 as amended by R.A. 10372 which reads as follows, “(d) Conduct visits during reasonable hours to establishments and businesses engaging in activities violating intellectual property rights and provisions of this Act based on report, information or complaint received by the office”. An article written by Raissa Robles, interviewing Professor Disini of the UP College of Law, succinctly sums up this absurd situation:

“’If you are a victim of copyright infringement, under the new law you can ask a government agency (the IPO) to enter a privately owned space in order to search, to look around.

Let’s take another situation – let’s take the case of rape or murder. Let’s say you’re related to someone who was murdered. You know that certain evidence about the suspected murderer is located in a particular place. As a victim’s relative, you cannot just go to the place and enter. You need a warrant.

Why is it that Congress will give the victim of intellectual property rights violations more rights than the victim of heinous crimes?

What about securing evidence against suspected terrorists? They need to get warrants.

But for suspected copyright infringements, authorities are allowed ”visits” which invade the privacy of alleged infringers.

Are these crimes so terrible that we are willing to set aside constitutional principles? I think there’s a disconnect there.’”[18]

In a nutshell, this means that the government is pushing for more powers to help those “victims” of intellectual property crimes, such as foreign multinationals or rich artists, over those victims of actual, heinous crimes. That the Philippine legislators will forego the constitutional safeguard of due process just to pursue a digital pirate who only hurts the profits of these companies, and denies the same treatment to victims of rape, murder, or other crimes. Furthermore, what is more disturbing with this law is that they seem to think it will all be fixed with the issuance of the IRR, as stated in Robles’ interview with Blancaflor.

[1] 2013, The Life of John Hancock. “The Liberty Affair” Available at: http://www.john-hancock-heritage.com/the-liberty-affair/

[2] April 2011, Williams, Walter E. “Smugglers Are Heroes, Just Look at the American Revolution” Available at: http://newsbusters.org/blogs/walter-e-williams/2011/04/27/smugglers-are-heroes-just-look-american-revolution

[4]www.demonoid.me (Now Defunct, RIP)

[6] 3rd floor, ShoppesvilleBldg, Greenhills, San Juan

[7] May 2012, Agbayani, Apa. “PH at Bottom 3 of World’s Wages”, Rappler News Site. Available at: http://www.rappler.com/nation/4612-philippines-at-bottom-3-of-world-s-wages

[8] Converted at PHP 40.00 to $ 1.00

[10]An Act Amending Certain Provisions Of Republic Act No. 8293, Otherwise Known As The “Intellectual

Property Code Of The Philippines”, And For Other Purposes, Republic Act 10372 (2012)

[11]An Act Prescribing The Intellectual Property Code And Establishing The Intellectual Property Office, Providing For Its Powers And Functions, And For Other Purposes, Republic Act 8293 (1997)

[12] March 2013 Sabater-Namit, Madel. Manila Bulletin Publishing, “’Jailbreaking’ Not a Crime—Palace” Available At: http://www.mb.com.ph/article.php?aid=2916&sid=1&subid=2#.UZn4cKKnpLU

[13]“FAQs on the amendments to the Intellectual Property Code of the Philippines”. Available at: http://www.gov.ph/2013/03/08/faqs-on-the-amendments-to-the-intellectual-property-code-of-the-philippines/

[14] Intellectual Property Code, Section 190(b)

[15]Section 212.Limitations on Rights. – Sections 203, 208 and 209 shall not apply where the acts referred to in those Sections are related to:

212.1.     The use by a natural person exclusively for his own personal purposes;

212.2.     Using short excerpts for reporting current events;

212.3.     Use solely for the purpose of teaching or for scientific research; and

212.4.     Fair use of the broadcast subject to the conditions under Section 185. (Sec. 44, P.D. No. 49a)

(RA 8293, 1997)

[16] November 2010. PHYS.ORG “US Woman to Pay 1.92 M Dollars in Music Piracy Case”. Available at: http://phys.org/news164601902.html

[17] “In case the infringer was not aware and had no reason to believe that his acts constitute an infringement of copyright, the court in its discretion

may reduce the award of statutory damages to a sum of not more than Ten thousand pesos (Php10,000.00) xxx” (Section 22, RA 10372)

[18] March 2013 Robles, Raissa. Raissarobles.com. Available At: http://raissarobles.com/2013/03/06/copyright-owners-have-more-rights-than-heinous-crime-victims-with-congress-ip-code-changes-lawyers-say/


DISCLAIMER: this is only a law student’s opinion 🙂

5 thoughts on “R.A. 10372 and the Misconceptions of Malacanang

  1. With Piracy as a Filipino Fact of Life as you said, do you believe that the move by the government to implement these changes on the Intellectual Property Law in able to be at par with global standards in piracy prevention appropriate in our current times? As you have said, Filipinos are earning less than what should be to have a decent livelihood. Taking computer software as a case and point, implementing an iron fist against piracy will prevent access to these computer updates to majority of our countrymen because they cannot afford to buy an original one. Thus, the level of intelligence of Filipinos will greatly diminish because of this. Do you think that it is the proper action by Malacanang to enforce these amendments or is it better that at the moment a status quo ante should be issued? Thank you.

    • Malacanang’s actions to limit piracy is a step forward to becoming a developed country. Although the availability of software will be curtailed, it is all part of the growing pains the Filipino people need to overcome to be one step closer to being an outstanding member of the international community.

      The problem is not the availability of the software, but the ability to purchase these software due to the poor living conditions many of our countrymen are in.

      So the question should not be “whether Malacanang was right in RA 10372” but rather, “Is Malacanang wasting time on these frivolous laws and shouldn’t they be working towards improving the country through labor and education reforms?”

  2. The ammended version of sec 216 clearly provides that the mall owners maybe held liable by mere association, regardless of whether he benefitted from it, had knowledge, or can control the infringer, mall owners are held liAble. the law says so.

    The law is selfish. In Robles’ February 15 article, “Reply to Ricardo Blancaflor, Intellectual Property Office Director General,” Prof. Disini pointed out: “The purpose of copyright, intellectual property (IP) rights is to enhance public domain—the works that are freely accessible to everyone. Because we want culture to flourish we give exclusive rights to people who make cultural works so that they can make a living from it. But only for a limited period of exclusivity. But when the exclusivity is gone, the public can enjoy it. Even without IP, the people are going to make songs. We want more songs and the only way for them to produce more is to give them exclusive rights. The end goal is to enhance culture. These works enter the public domain so we don’t have to pay anymore. The Spoliarium copyright is gone. So now I can take a picture of it, make a song about it, that further enhances the culture. How come there is no provision in the IP Code that tells us how to donate to the public domain. The IP Code is all about creating and protecting property instead of enhancing culture.”

  3. Piracy, as you’ve mentioned, is a Filipino fact of life. The way I see it, it’s a fact of human life, period. In China, I wouldn’t think that laws about IPL is implemented there, as many fake this-and-thats are sold every day. Fake iPhones made in china, fake Louis Vuitton bags in Dubai, illegal imported cars in Clark Philippines, illegal CDs imported by balikbayans to the u.s. Piracy, is everywhere.

  4. Pingback: Students’ Take: RA 10173 viz a National ID system, and Malacanang’s FAQ on the effects of RA 10372 | Berne Guerrero

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