Mod Chips Legal In the UK

An anonymous reader writes "Good news out of the UK! Techdirt reports that an appeals court has overturned a lower court ruling and has now said that mod chips do not violate copyright laws. The case involved a mod chip seller, who imported mod chips for the XBox from Hong Kong and would sell the chips or mod the Xbox's himself. He was charged with copyright infringement and found guilty by a lower court. The appeals court has dismissed all charges, however."

Comments

This is ridiculous...

[superash]

After I buy something, it is _mine_ ! Case closed. I can do whatever I want to do with it. If I had stolen it then I am guilty. I don't see a case otherwise.

Re:This is ridiculous...

[jamesh]

Unless it's licensed, not sold :)

Fortunately the 'first sale' principal has held up in most places where it has been tested, so your argument seems to hold true.

But to stretch your argument until it breaks, if you buy a gun then it's yours, but you still aren't allowed to modify it in such a way that it is illegal (eg upgrade it to semi automatic, saw of the barrel(s) to make it easier to conceal). Likewise if a law is introduced that says you cannot modify your games console to allow it to play illegal games then your argument is incorrect, and I think that is what was being tested here (although I think they were trying to make an existing law apply rather than testing a law brought in to address that problem specifically).

Re:This is ridiculous...

[arivanov]

If it is licensed not sold it is subject to a different taxation regime.

The vendors and especially the software ones cannot have it both ways. It is either a sale or a rent.

It it is a sale it is subject to appropriate financial regime for sales (VAT, can be registered as a capital asset, depreciation, etc). Income from sales can be taxed in a different jurisdiction. Even if the sale has taken place in a "nasty taxation" place like UK, Scandinavia, New York, etc, all taxation can be done in a place with lax taxation like Ireland in the EU or Texas in the USA.

If it is a rent it cannot be depreciated and cannot count for capex. It is opex, period. Similarly, income from rent in nearly all countries in the world must be taxed locally. The usual tax evasion practices of big software and hardware vendors are outright illegal and forbidden by law.

So frankly, if it is licensed and the licensing contract is valid - come on, try to prove it. All the defendant needs to bring are the taxation statements of company X. If X wins it will lose its taxation regime.

Lose-lose.

Re:This is ridiculous...

[Hognoxious]

After I buy something, it is _mine_ ! Case closed.

Nope, I'm pretty certain you have to open it to put the new chip in.

Re:This is ridiculous...

[sqldr]

I once saw a conference with bill gates, where a child popped his hand up to ask a question. We never got to hear the question. He got as far as "my dad bought me a copy of windows". He interrupted to say "he didn't buy it, he /licensed/ it" before going off on a diatribe that instead of owning a tangible object (a CD with windows on it), you are licensing the 1s and 0s on it. He was about 12 years old. What a cunt.

Re:This is ridiculous...

[Red Flayer]

Even if the sale has taken place in a "nasty taxation" place like UK, Scandinavia, New York, etc, all taxation can be done in a place with lax taxation like Ireland in the EU or Texas in the USA.

False. Ever hear of use tax? If you use the good in NY, and its a taxable good, be prepared to pay use tax is the sales tax paid on the purchase is less than the sales tax in NY.

If it is a rent it cannot be depreciated and cannot count for capex. It is opex, period.

You sound pretty confident for someone who doesn't know what they are talking about. Capital leases are very common... that's when you have a lease (rental agreement) and you capitalize the asset. The stream of payments for the lease is amortized, and meanwhile you depreciate the asset and record your depreciation expense.

The usual tax evasion practices of big software and hardware vendors are outright illegal and forbidden by law

What are you talking about?

I'd also add that licensing != leasing, I think you're confused on the topic.

I guess, to sum up, I'd say that gettig accounting/finance advice on slashdot is like getting legal advice on slashdot. Some of it seems to make sense, but I'd rather have duct tape ripped from my scrotum than have to go before the courts or the IRS using advice from slashdot as my only source of information.

Re:This is ridiculous...

[tehcyder]

I once saw a conference with bill gates, where a child popped his hand up to ask a question. We never got to hear the question. He got as far as "my dad bought me a copy of windows". He interrupted to say "he didn't buy it, he /licensed/ it" before going off on a diatribe that instead of owning a tangible object (a CD with windows on it), you are licensing the 1s and 0s on it. He was about 12 years old. What a cunt.

Hey, the child was only asking a question...

Expect anti-modchip legislation in 3, 2, 1...

[Kjella]

Don't expect them to give up. Just like Bush was recently lost his third case in the US supreme court for the third time over Gitmo prisoners, they keep coming back and is considering new legislation to "solve" the problem.

Re:Expect anti-modchip legislation in 3, 2, 1...

[Kjella]

In general, I think they're far too trigger-happy on creating new laws because it happens to be an old crime using new technology. Like the law a little while back on "cyberbulling", isn't harassment already a crime? Fraud? Theft? Blackmail? If i blocked the door to your brick-and-mortar store, they'd certainly find a way to prosecute my "denial-of-service" attack. Yes, there are probably a few crimes that really are new, but most aren't. Sometimes they don't make sense like we go from big industrial pirate industry to smalltime individual pirates, then the penalites should go up, up and away. Cyber-something is most an excuse to push new laws going in the direction they want.

Re:Expect anti-modchip legislation in 3, 2, 1...

[drsquare]

And the best part is, under new legislation, mod-chip sellers can be held for 42 days without charge.

Re:Expect anti-modchip legislation in 3, 2, 1...

[Bastard of Subhumani]

I doubt he really has an opinion on modchips.

I liek mudkips.

Yours sincerently,

    GWB.

Of course they don't violate ... copyright ...

[apathy maybe]

At least, not by any sensible person's definition or understanding of the term "copyright". That is, there may be some legal jurisdictions where a piece of hardware can be considered a violation of copyright law, even if that hardware is not in and off itself a violation. (If you know what I mean.) However, in no sensible place could it be considered to break copyright, anymore then region free DVD players could be considered tools to break copyright.

(I believe in Australia both are perfectly legal.)

Of course, what the law says, and what a sensible person would expect the law to say are often two completely different things. Where the law is too complex for the average person to understand, then there is something wrong with it. (Resists temptation to explain why all laws are wrong, complex or not.)

Re:Of course they don't violate ... copyright ...

[teh kurisu]

Of course, what the law says, and what a sensible person would expect the law to say are often two completely different things.

I understand why copyright infringement is illegal. What I don't understand is why facilitating copyright infringement is illegal. It's conceivable that somebody is coming to harm when copyright infringement occurs, but nobody necessarily comes to harm when facilitation occurs. If I'm not mistaken, mod chips potentially fall under the

I say potentially because mod chips can be used to play import games, which is a legal activity (the fact that Sony somehow managed to shut down Lik-Sang notwithstanding). I've long held the (totally unsubstantiated) belief that games console manufacturers deliberately tie together their region encoding and copy protection functions, where disabling one disables both, so that they can cry copyright infringement whenever somebody mods their console for the purpose of playing imports.

Re:Of course they don't violate ... copyright ...

[SkunkPussy]

"Where the law is too complex for the average person to understand, then there is something wrong with it."
great point. I have been saying for some time, that as there are so many laws that its impossible for any individual to be aware of all legislation that pertains to them, how can it be possible for a well-meaning individual to obey said laws? Therefore how can this legislation be valid?

Re:Of course they don't violate ... copyright ...

[Opportunist]

It's playback prevention.

Nobody protects my playback. Actually, the opposite takes place.

Re:Of course they don't violate ... copyright ...

[Kjella]

Of course, what the law says, and what a sensible person would expect the law to say are often two completely different things. Where the law is too complex for the average person to understand, then there is something wrong with it.

I think you're mixing two different things here:
1. The person has never read the law, only guessing on what he expects.
2. The person has read the law, but still don't get what it's saying.

The first one usually happens because there's a lot more cases to cover than what can be briefly summarized. For example you'd naturally assume copyright has to do with copying, yet for example public display doesn't involve copying at all yet it's one of the exclusive rights. I think it's rather presumptious to think that a person should be able to think up everything by themselves. Or if you want an example that something is legal instead of what's expected many people think the exclusive right to copy is absolute and final, not thinking up any "fair use" unless it's pointed out to them.

Neither of these are really a big problem with the law, it's rather that most people don't have time to be familiar with the entire body of law. Nor do you really have to be, I need to know stealing is illegal but not every detail about what's petty theft, armed theft, grand theft, robbery, armed robbery and so on. Nor to I need to know things like building codes unless I intend to build a building. The actual level of detail required to function like a normal citizen isn't that high.

The other issue can be a big problem, but usually it happens because the law is trying to be very, very precise which makes it full of definitions, enumerations and whatnot that reference each other and are made up of very awkward English. And that's just when they don't use terms with a specific legal meaning, which happens in all professional fields. Often it ends up being close to what the public expects, but it's hard to understand. It leads to gems like this (from the defintion of "Pictorial, graphic, and sculptural works"):

"Such works shall include works of artistic craftsmanship insofar as their form but not their mechanical or utilitarian aspects are concerned; the design of a useful article, as defined in this section, shall be considered a pictorial, graphic, or sculptural work only if, and only to the extent that, such design incorporates pictorial, graphic, or sculptural features that can be identified separately from, and are capable of existing independently of, the utilitarian aspects of the article."

Do you understand what it's trying to say? It's trying to deal with for example an engraved sword, and isn't unreasonable. I can understand people completely mind blanking when they hit a sentence like that though. Obtuse laws are actually a greater danger IMO than over-detailed laws. If a law leaves great room for interpretation, it will almost certainly be bent to be used in the most unreasonable ways. There's been quite a few examples of that pointed out there where "terrorism" laws are being used to deal with people that in no way are, or could even reasonably suspected to be terrorists.

If the law was to be easy tor the average person to understand, I don't think it could deal with the corner cases. In a court case, people don't sit together and reasonably discuss what a natural interpretation of the law is, it's one party bent on conviction and one party bent on not getting convicted. It won't be an academic discussion, it'll be SCOs legal theories and they need to be refuted point by point using precise definitions, which are inherently hard to understand.

I think the biggest issue is the distance between recognizing that a law is bad and being able to do something about it. Not many are going to flip-flop between democrats and republicans over single laws? In europe it's generally a litle better since you have more parties so with public pressure people move to "adjacent" parties, but then there's other concerns. For example, there have

Re:Of course they don't violate ... copyright ...

[Anonymous Coward]

I understand why copyright infringement is illegal. What I don't understand is why facilitating copyright infringement is illegal. Well, I assume it's the obvious:

(1) We want to prevent copyright infringement (see why copyright infringement is illegal).
(2) Banning possession of mod chips will help achieve (1) as pirated games cannot be played.
(3) Banning sale of mod chips is easier than (2) as it is easier to prosecute ten distributors than a thousand consumers.
(4) Politicians decide, rightly or wrongly, "allowing import games and backup copies" is wanted only by a small fraction of people.
(5) Politicians judge that our collective desire from (1) to prevent copyright infringement, scaled by the effectiveness of (2) and (3), is greater than our desire from (4) for the non-piracy benefits of mod chips.

There are other examples of laws like this; driving fast doesn't harm people, vehicle/vehicle and vehicle/pedestrian collisions harm people. But we regulate vehicle speed to achieve the goal of regulating vehicle/vehicle and vehicle/pedestrian collisions because vehicle speed is easier to regulate.

MrModChips

[niceone]

I couldn't find anything on a news site I trust yet, but from the defendants front page it looks like they are happy! Not that I don't trust slashdot or anything, but a little confirmation is nice...

Re:I seriously doubt

[Silver Sloth]

At the risk of being accused of trolling Microsoft have the right to decide whatever rules they like about access to Xbox live.

Re:I seriously doubt

[thermian]

At the risk of being accused of trolling Microsoft have the right to decide whatever rules they like about access to Xbox live.

They own it and operate it, so yes I agree, they do.

Whether such bannings would be considered fair by anyone else is beside the point, they can do what they want. We are not under any obligation to use Xbox live.

Provided the modding crowd is sufficiently small, they can do it without even effecting the majority of the community.

Re:Chips Legal but...

[FinchWorld]

Generally the modchip itself is not illegal (Well, me being in UK), but often to play copied games they use a modified version of the original bios/software/whatever which is the illegal part. As far as xbox modchips go I saw a general trend for them to be sold with the cromwell bios, which contained no proprietary code, and allowed various linux distributions to be used, but would not allow for the running of copied games (or even genuine if memory serves correctly). They also came with a simple way to reflash the chip and often instructions on how to obtain these other bioses from various sources.

GNU/Linux on hardware *you* *bought*!

[GNUPublicLicense]

It's overboard to dissalow GNU/Linux to fully use the hardware you bought by default. Mod chips are here to insure proper balance. Actually, I think explicit locking of hardware with an OS is illegal in many countries. Maybe mod chips are part of their business model: they say mod chips are bad, but behind the scene if you look carefully, they actually sell them! Because at the end, that makes people spending more money on their hardware...

Re:I seriously doubt

[Saffaya]

You have to keep up with times though, we are in the X360 era.
If you want use your X360 for something else than M$ approved software, you cannot use Xbox Live.
It is due to the regular and remote bios modifications done by Xbox live to your console so it is up to date for countering any software exploitation.

The convenience of using XBMC or emulators, then switching off the modchip to play on xbox live are a thing of the past as far as the X360 is concerned. A real pity.

Old saying still applies

[Hells]

Mod chips dont pirate games, people do.