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CHAPTER I INTRODUCTION TO IPR DEFINITION Intellectual Property Rights which is abbreviated 'IPR' or the acronym 'IP' has equal

l meaning to Intellectual Property Rights (IPR), i.e., rights that arise as result of mind effort to produce a product or process which give benefit to human being. Essentially, an intellectual property rights is a right to enjoy economically as a result of intellectual creation. The regulated objects in IPR are certain works as arose or designed of human intellectual abilities. Generally, intellectual property rights classified into two big domains: 1. Copy Rights 2. Industrial Property Rights, included: Patent; Industrial designs; Trademark; Repression of unfair competition; Layout design of integrated circuit; Trade secret.

In Indonesia, entities which authorized for Intellectual Property Rights are the Directorate General of Intellectual Property, Ministry of Justice and Human Rights Affairs. Directorate General of Intellectual Property Rights, hereinafter named the Intellectual Property Directorate has duty to conduct tasks inside the intellectual property rights department ruled under applicable legislation and policies from the Minister. Directorate General of IPR has several functions: a. b. c. Planning, implementation and supervision of technical policy in the Guidance which includes providing guidance, services, and field of IPR; preparation of standards of IPR area; Technical and administrative services to all elements within the

Directorate General of Intellectual Property Rights. The hierarchical organization of Directorate General of IPR composed as: a. b. c. d. e. Rights; f. Directorate of Information Technology. In 1994, Indonesia joined WTO (World Trade Organization) by ratifying the Uruguay Round (Agreement Establishing the World Trade Organization). An important function of WTO Agreement was Trade Related Aspects of Intellectual Property Rights Including Trade in Counterfeit Goods (TRIPs). Along with TRIPs, Government of Indonesia has also ratified international conventions of IPR, included: a. Paris Convention for Protection of Industrial Property and Convention Establishing World Intellectual Property Organization, with Presidential Decree No. 15 of 1997 on the changes of Presidential Decree No. 24 of 1979; b. c. 1997; d. e. year 1997. There is a special body managing international issues of IPR which become member of United Nations called the WIPO (World Intellectual Property Organizations). Indonesia joined as the members and has been ratified Paris Convention for Protection of Industrial Property and Convention Establishing of Bern Convention for the Protection of Literary and Artistic WIPO Copyrights treaty (WCT) by Presidential Decree. 19 Works by Presidential Decree. 18 year 1997; Patent Cooperation Treaty (PCT) and Regulations under the Trademark Law Treaty (TML) with Presidential Decree. 17 of PTC, with Presidential Decree No. 16 of 1997; Secretariat of the Directorate General; Directorate of Copyright, Industrial Design, Integrated circuit layout, Directorate of Patent; Directorate of trademarks; Directorate of Cooperation and Development of Intellectual Property

and Trade Secrets Affairs;

World Intellectual Property Organization, as discussed above. Entering into new millennium, intellectual property becomes a very important issue in both national and international forums. The inclusion of TRIPs into WTO agreements of 1994 signaled a new era on IP developments worldwide. Thus, the current IPR issues can not be discharged from the trade and investment. The importance of IPR toward trading on economic development has been stimulating a new era on science- & economic-based development. FUNDAMENTAL REGULATION Fundamental regulations on Intellectual Property Rights in Indonesia is regulated by Copyright law No.19 of 2003, stated that such Copyright law is to protect, included any forms of, the copyright program or computer software, manuals or software programs use computers and books (in any forms)of others. From July 29, 2003, Government of Indonesia concerning the Protection of Copyright stated the protection is also covering: The program or computer software, manuals usage of program or Of citizens or those stay or domiciled in the United States, or For whom the citizens or those stay or domiciled in the United States computer software, and other similar books.

has economic rights derived from the COPYRIGHT ACT, or those legal entity (directly or indirectly controlled, or shares majority or other proprietary rights owned citizens or those stay or domiciled in the United States) have such economic rights; The program or computer software, manuals or use of software The BSA members include ADOBE, Autodesk, Bentley, CNC Software, Lotus Development, Microsoft, Novell, Symantec, and Santa Cruz Operation are several leading creators companies of computer software for personal computers (PCs), and also some governing body of American law located in United States. Therefore, either, programs or computer software, books, guidelines for the use of software programs or computer and other similar books created by these companies are protected by Copyright Law Of The Republic Of Indonesia. programs and other similar books that first published in the United States.

If someone committed to violation for copyrights of others then that person may be subject to criminal prosecution or civil lawsuit. If you or your company violate the copyrights of others, that is intentionally and without right to produce, imitate or copy, publish or broadcast, trade or distribute or sell the copyrighted works of other parties or the goods of copyright infringement (the products pirated) then you have committed a criminal act subject to criminal sanctions as follows: CRIMINAL PROVISIONS ARTICLE 72 (1) Any person who intentionally and no right to conduct acts referred as in Article 2 paragraph (1) or section 49 and subsection (2) shall be sentenced to imprisonment each at least 1 (one) month and / or a fine of between Rp. 1,000,000.00 (one million rupiah), or imprisonment as much of 7 (seven) years and or a maximum fine of Rp.,00 (five hundred million rupiahs). (2) Any person who intentionally to publicly broadcast, exhibit, distribute, or sell an invention or copyright infringing goods or the Related Rights as referred to in paragraph (1) shall be punished with imprisonment of as long 5 (five) years and or maximum fine of Rp. 500,000,000,000.00 (five hundred million rupiahs). (3) Any person who intentionally and no right to reproduce usage of commercial purposes on a Computer Program shall be punished with imprisonment as long of 5 (five) years and or a maximum fine of Rp. 500,000,000,000.00 (five hundred million rupiahs). (4) Any person who intentionally violates article 17 shall be punished with imprisonment as long of 5 (five) years and or a maximum fine of Rp. 1,000,000,000,000.00 (one billion rupiahs). (5) Any person who intentionally violates article 19, chapter 20, or Article 49 paragraph (3) shall be punished with imprisonment as long of 2 (two) years and or a maximum fine of Rp. 150,000,000,000.00 (one hundred and fifty million rupiah). (6) Any person who intentionally and without any authority

violates article 24 or article 55 shall be punished with imprisonment as long of 2 (two) years and or a maximum fine of Rp. 150,000,000,000.00 (one hundred and fifty million rupiah). (7) Any person who intentionally and without right violates section 25 shall be punished with imprisonment as long of 2 (two) years and or a maximum fine of Rp. 150,000,000,000.00 (one hundred and fifty million rupiah). (8) Any person who intentionally and without authority violates Article 27 shall be punished with imprisonment as long of 2 (two) years and or a maximum fine of Rp. 150,000,000,000.00 (one hundred and fifty million rupiah). (9) Any person who intentionally violates Article 28 shall be punished with imprisonment as long of 5 (five) years and or a maximum fine of Rp. 1,500,000,000,000.00 (one billion five hundred million rupiah). Besides, you and or your company is also subject to a civil lawsuit from the copyright holder or owner, who may demand compensation and / or request the court to confiscate pirated products and ordered to stop you or your company's violations.

CHAPTER II IPR IN INFORMATION TECHNOLOGY Advance result achieved through information technology is not separatable from existence of IPR. In general, IPR is a legal protection of the rights state-granted as artsmanship of creative process for the creator or inventor. Cyberspace is supported by two main elements, computer and information, related directly to objects in the IPR setting, namely copyrights, patents, trademarks, industrial designs, trade secrets and integrated circuit layout. IPR has special attention since these rights can be misused as easier by means of information technology convergence phenomenon that occurred. Without any protection, such highly valued-object would be loss of value, when the creator or inventor does not get any reimbursement issued during creation process, instead of the owner, while other parties gaining its economic benefits, otherwise. In Indonesia, such IPR violation has been very embarrassing. Indonesia rated of world's third largest after Ukraine and China in terms of software piracy. Table below explained the U.S. industry estimates losses due to copyright piracy worldwide in 2004.

U.S. industry estimates losses due to copyright piracy worldwide in 2004 (US$ million) Film Recorded Music Loss % Loss % 12.0 275.0 45.0 30.0 120.0 State Film Loss % NA 80 % 90 % 45 % 30 % 70.0 11.9 115.0 41.5 343.5 100 % 66 % 65 % 55 % 52 % Software Loss % 9.0 751.0 64.0 63.0 330.0 83 % 87 % 91 % 75 % 63 %

State Pakistan Russia Ukraine Argentina Brazil

Recorded Music Loss

Software Loss %

Bulgaria Chile Colombia Dominica Egypt India Indonesia

4.0 2.0 40.0 2.0 NA 80.0 32.0

35 % 40 % 75 % 20 % NA 60 % 92 %

6.5 24.8 51.6 10.3 7.5 67.3 27.6

75 % 50 % 71 % 75 % 40 % 50 % 80 %

16.0 41.0 34.0 3.0 35.0 220.0 112.0

71 % 63 % 50 % 76 % 68 % 74 % 87 %

Considering the table above, it concluded that the level of occurred piracy of Indonesia in computers software was very apprehensive. About 90% of programs used in Indonesia are illegal. A case sample associated with piracy program in Indonesia was in 2001; Microsoft Corporation filed a lawsuit against Altec Computer and other computer dealers for violation of Copyright Computer Programs owned by Microsoft as the Copyright Holder of Windows 1998 and Microsoft Professional Edition 2000. The mentioned five dealers above have installed illegal copies of software Microsoft Windows and Microsoft Office on their products and then selling to consumers without any necessary documentation, license agreements, original disk or CD or any manual that should exist. The computer dealers eventually reach a negotiation agreement with Microsoft Corporation, although the claimant (Software Company) that actually has won its lawsuit. In the agreement, the five dealers agreed to provide compensation exceeded US$ 100,000 and 20 new PCs equipped with legal software for social purposes. They also shall make an announcement (statement) of support to be published on local newspapers. Actually, the piracy is degrading image of Indonesian Information Technology in common. It decreased investor confidence, even lowering confidence from potential users of Indonesian TI labor. In the meantime, it stated that Indonesian TI has not yet being trusted appropriately by the international parties due to bad image of such piracy cases. As the worst, that Indonesia is the first Asian country signed the "Internet Treaty" Agreement of 1997. But Indonesia considered as top three world rankings as the most hijack software cases after Vietnam and China, under the BSA report (Business Software Alliance). Enormous growth of software piracy in Indonesia presumed due to unaware society that not ready to accept the IPR yet. In

addition to software piracy, it seems become commonplace in our country once and generally done without any guilty. Notwithstanding of, on the contrary, people are still unaware of values and intellectual property rights contained in the software of their used. And also it influenced by unreached price of proprietary software toward most users in Indonesia. Here is a list price of Microsofts genuine software: 1. 2. 75 3. 4. 175 5. 6. CALs U.S. $ 750 7. 8. Original CD Office 2000 SBE Edition (includes MS Original CD Win32 Office XP Small Business Home The above prices are so differ than the pirated CD package in Indonesia. For us too, it feels like we have been very unusual to find how software-the software or in the form of collection is sold only with prices ranging from five to several hundred thousand dollars in computer stores, equipment or accessories. A quite intriguing is the fact that the use of pirated software not only covers the general public, but also includes the corporate, government, or even its own law enforcement officers can be said no guarantee of free from software piracy. Eradication of such problem probably face obstacles, as found in mailing list that show an ironic comment: "Have you ever watch Buser shows and similar entertainments? It sometimes shows at somewhere inside the police station, the officer while typing letters or news events, etc., I suggest, look closer on their assembled computers, I dont mean to accuse, but the assembled computer, somehow, seems i.d.e.n.t.i.c.a.l." to software piracy, damn it, I should report it. But how???... --- ITCenter. " Word, MS Excel, MS Outlook, MS Publisher, Small Business Tools) U.S. $ 210 (includes MS Word, MS Excel, MS Outlook, MS Publisher) to U.S. $ 200. Original CD of Windows XP Professional U.S. $ 175 Original CD of Windows 2000 Server 1-4CPU for 5 Original CD of Windows XP Home Edition $ 75 Original CD of Windows 2000 Professional 1-2CPU $ Original CD of Windows 98 Second Edition $ 75 Original CD of Windows Millennium Edition U.S. $

Apart from the fact that such post may have no any evident, but the fact founded in our environment, this seem possible, even highly to occur. Then, what actual solution suits to and cost-effective to legalize using of the software? either using open source or proprietary equally require investment (macro solution) is large enough. Generally, recent human resources posed are now trained to use commonly used software such as Windows, Office, and any related proprietary software, and therefore, to use proprietary software as legally also require significant costs. On the other hand, this solution might be missed with opensource software such as StarOffice of Linux, for example, but it also cost human resources training and therefore an invisible-cost may arise of declined productivity during adaptation period. To reduce such increased piracy rate worldwide, an US software industry association known as BSA (Business Software Alliance) have declared war and will keep to track the use of illegal software by private companies by means of involving community through a contest with prizes USD 50 million to anyone who gives accurate and precise information concerning the use of illegal software in any enterprise. The information collected to BSA is from communities, lower loyal internal employee to their company. Besides government of Indonesia will intensify its campaign against IPR violation and raise public awareness about the importance of this issue, The government will also increase the frequency of cleaning (sweeping), aggravate punishment for IPR violators and make efforts to prevent the entry of pirated products to Indonesia. a step taken by government is to set up a team for Presidential Decree 34, which is responsible to implementation of copyright laws, trademark and patent.

CHAPTER III IMPACT OF IPR INFRINGEMENT The impact of software piracy in Indonesia is not only detrimental to the software company, but the Indonesian government will also be affected. Local software industry to grow not because they do not get results that are worth due to piracy. In addition, they become reluctant to produce commercial software, of worrying their product will be hijacked. The impact of software piracy in Indonesia is not only detrimental to the software company, but the Indonesian government will also be affected. Local software industry to grow not because they do not get results that are worth due to piracy. In addition, they become reluctant to produce commercial software, of worrying their product will be hijacked. Apart from the software company that is increasingly losing money because of piracy, in fact Indonesia is now the IT world is really facing a big problem. With the enactment of TRIPs (Trade Related aspects of Intellectual Property Rights Agreement) that proclaimed the World Trade Organization (WTO) starting January 1, 2000, producers of computer software packages mainly incorporated in the Business Software Alliance (BSA) will demand they made the program dealt with pirates strict accordance with the provisions. United States, through the United State Trade Representative who in recent years has ranked Indonesia priority watch list. The position of this class with other countries such as China, Bulgaria, Israel, Malaysia, Brunei, South Africa, Mexico, and Korea. In fact, this grouping is not without sanction. If Indonesia can not fix things, then is the use of Special 301 sanctions on the United States (U.S.) Trade Act. This provision gives the government a mandate to the United States to retaliation (retaliation) in the field of economics to Indonesia. "In this regard, the Indonesian markets in the United States are at stake, in which the main beam, i.e. involving copyright piracy video compact discs and computer programs, and patents relating to drugs (pharmaceuticals). Therefore, an important fact, is the commitment of Indonesian law enforcement agencies on international standards of IPR itself. Moreover, Indonesia has expressed participate in the convention on Establishing the World Trade Organization (WTO Convention)

in which there is Trade Related Aspects of Intellectual Property Rights Agreement (TRIPs). Indeed, the penalty has not been done directly, but can result in Indonesian exports to the USA and the tail-tail affect Indonesia's economy in general. Unfortunately still ignored by the wider community, including the education, the field of IPR is very closely related to the growth of the economy of a country. Growth of respect for IPR grows in line with the growth of the economy of a country. "If a country's economy depends on foreign investment, and they were very concerned with IPR protection. The main complaint from U.S. investors is inadequate enforcement of IPR in Indonesia. Two things are becoming major focus, namely respect for copyright piracy involving VCD and computer programs, and the award of patents relating to drugs.

CHAPTER VI SOLUTION TO IPR INFRINGEMENT To suppress numbers of software piracy cases, alternatively, is using a Linuxbased software by free of charge. So still able to get cheaper prices, without having to use pirated software. But it is still difficult. Although some of this last party merchants have worked hard to socialize the free Linux software. But buyers still choose Microsoft software that has been familiar for a long time. For this it takes time, because Linux is relatively new is known the general public. Need market advocate, the bias for Linux software community. The second alternative is organizing a Campus Agreement event in order to give license to mass-campus computers with much cheaper price, among others, for Windows 98, Windows NT, and Microsoft Office. If this model can be widely disseminated among the campus, it should no longer justification for the act of software piracy in the campus environment. A bid from Microsoft Indonesia by their Microsoft Campus Agreement has benefit to us. But in reality on the ground that not all educational institutions have adequate funds to pay for the license. Here is an illustration of the amount of funds that need to be issued by an educational institution. Frankly speaking, this information is only interpretation of existing information on the Microsoft site. Indeed, educational institutions face serious dilemmas in the legal aspects of software and financing. For example the price of the software used is as follows (this information is only approximate at least):

Program Unit price Windows 95 USD 160 Program Unit price Windows 98 USD 200 Windows NT USD 598 (without a license CAL) CAL Windows NT USD 15 per 1 user connected to a server As illustrative, an institution of 100 computers installed a MS Windows 98 as their operating systems may spend:

Type Lisensi MS Windows 98 Lisensi MS Windows NT CAL for MS Windows NT Total

Number Price 100 1 15 200 598 100

Total 20.000 598 1500 22098

From the roughly estimates above, an institution which has 100 computers and 1 NT server will spend at least US$22,098 just to purchase the operating system license. It is not including the cost of application programs. It is licensed from a vendor was not as simple as above, there are several licensing models, i.e.:

Premium customers. This license is granted to a large class of

customers which also includes technical support and access to internal knowledge (Knowledge Base).

Customer usual. Just get technical support from partners (Solution MOLP (Microsoft Official License Programming), also known as Mass License granted to an institution that uses the program in large

Provider, CTEC, etc.)

package-efficient, but has now apparently no longer exists.

amounts, e.g., for educational institutions known as the Microsoft Campus Agreement. But in this discussion will only discuss a regular license granted waivers for the campus. This license allows a member institution to have MS software products more cheaply, because the institution has been paid by the piece per year based on the number of institutions. A cost calculation estimated from number of full-time equivalent (FTE). FTE was calculated based on number of staff and faculty that the school reported to the government. The next year, it will be charged for a prolonged contract. The license included:

Microsoft Office Standard & Professional Editions Microsoft Office Macintosh Edition Microsoft Windows Upgrades

Microsoft BackOffice Server Client Access License (CAL) Microsoft FrontPage Microsoft Visual Studio? Professional Edition Microsoft Office Starts Here?atauStep by Step Interactive by Microsoft Press From the above description, it clearly does not include programs such as

compilers, graphics processors are also required for an educational institution. Certainly it occurred a question, whether any educational institution in Indonesia are able to pay these expenses? Since the end-user those got the burden is student college. Of course we have to find another way out complement to the institutions that have limited funds or want to wisely use the funds from students. It was then the institute can sell back to the students or staff to be charged at $ 25 - $ 50 to get the software. Indeed, this cost is cheaper than the academic price, but remained high for the size Indonesia. Even other words indirectly spearhead the university's vendors marketing to the students. Alternative Options Some existed solutions offered by several vendors and the current fix is still leasing to enormous cost expenditure. Even though, it is using such licenses to lower the cost. But if we multiply that value by the number of medium-sized companies in Indonesia, then the amount will be quite large, and the economic burden that can not be ignored anymore. Of course there will be a question, is there another solution to escape from this condition? The answer is YES, and will be presented in this paper. Some possible solutions to avoid problems on charges of piracy are as follows: 1) Wilingfully and forced to buy the software used. Both the operating system, and application. Of course for large institutions should take advantage of any form of license that alleviates the total cost. But look at most of the mitigation fee applies only to companies or institutions that use the copy for more than 5 computers, certainly for small companies will still pay the regular price. With Indonesia's current economic conditions, this solution will lead to considerable economic burden. Imagine for a company or educational institution which has 100 units of computers. It certainly would not want to have to expect the mercy of the vendors to decrease license costing. The problem with

this solution cost estimates had been outlined above. 2) Develop the software used, either operating systems or applications. This solution is ideal and will be very good at all when it may be implemented. Similarly, it will also take a lot and Human Resources that do not play games. Can honestly say HR field of Information Technology in Indonesia is not yet able to do this at large. This is not apart, from the present reality, most of the activities of IT practitioners is on the acquisition of operational skills and the implementation of the system. In addition, in the fact, accessing internal information from the used software technology is very limited. 3) Utilize the Open Source applications, and helped develop it so as to conform with existing needs. Open Source Program is a program that has a different licensing system with a commercial program in general. License law used in the Open Source program allows the use, copying, and redistribution freely, without violating the law and ethics. Open Source Program has been developed relatively long time, and has been used as the main backbone of the Internet system. Various Open Source applications are currently freely available. Use of Open Source is widely in Indonesia will avoid the expenses and charges of piracy. An even user of the Open Source community has also grown widely in various regions in Indonesia. Considering the three possibilities above, on limited time, money and human resources solutions from utilizing an Open Source application is very promising to be applied to overcome this problem. Unfortunately it is still a little response from the Government about the possible use of Open Source as a solution to IPR issues. As an outgrowth of using open source applications, so if the budget proposed to purchase the software, otherwise, it can be collected to be granted to Indonesian programmers to develop open source applications will certainly provide greater benefits, than buying a finished application from abroad. Of course this requires future vision, not just short-term vision. It does not necessarily to have an institute to use open source only, or just use agreement based vendor. The percentage of combination should be considered based on long-term needs and the availability of funds.

CHAPTER V CONCLUSION Our responsibilities primarily as the program or software computer users are to buy original software for own usage. Buying such software for business purposes, each unit of computer in business location is to be installed original software and its manual user. In condition that buying a single pack of original software package to be utilized to more than single unit computer or rent, copying, or distribution the program or software or its user manual by any reason, without any written consent of the owner or copyright owner toward the items mentioned above, then you are considered conducting crime or to act against the crime. While buying a program or computer software, make sure to examine tat you are only buying an original package. There founded several piracy product which packaging as similar to its original version, but differ from its original quality. It is a must to buy only the original program or software. Buying a counterfeit product or its pirated-types, we also not only contravene the copy owner of their benefit, but also inflict a financial loss to the computer industries as whole. Each program or software creator either smaller or large, have been investing great time and capital to develop and creating their products for commercial use. Each dollar they spent to buy such original product will be tunneled for research and development purposes to improve the product quality to become more sophisticated. But, otherwise, if we buy a counterfeit or illegal product, each rupiah we spent only benefited the hijacker those actually do not reserve the right whereas the legal owner have nothing. Such financial loss is very harmful, because:

Decreasing sum of money used for research and development of the Decreasing local technical support for the product support Decreasing program distribution ability or software distribution which Resulting a local economic inflict due decreased benefit faced by

program or software.

has been improved its quality, and

official distributor, and finally it decreases income and work opportunities.

CHAPTER VI STUDY CASE In the beginning of 2001, Microsoft Corporation located at One Microsoft Way, Redmond, Washington, filed a lawsuit against five Computer Retail-dealer located at Jakarta. Four of them, namely PT Panca Putra Komputindo, HJ Komputer, HM Komputer, and Altex Computer, were filed to State Court (PN) of Jakarta Pusat. The another companuy, PT Kusumomegah Jayasakti, was brought into PN Jakarta Barat. Microsoft Corporation has filed a suitcase toward the five company for violation of Copyright Computer Programs owned by Microsoft as the Copyright Holder of Windows 1998 and Microsoft Professional Edition 2000. The lawsuit was opened after an investigator from Microsoft Corporation conducted a market survey in order to check presumed violation of several dealers. The program labeled as DTPP (dealer test purchase program). The result of DTTP toward the five dealer was observed of instalation process for Microsoft Windows and Microsoft Office softwares into computer harddisk on the retail products was not match with its license numbers. To prove assumption of violation, Microsoft hire an investigator (private detective) conducting the DTTP. The method is the private detective buying several computer from the dealers. After that, the products (computers) were disassembled to check its production code and program contained, it is proved then, inside the product has been installed some unlicensed Microsoft Windows and Microsoft Office. Considering the evidence, make the dealer to admit their act of violation and breaching of license product. For Microsoft itself, installation and selling of Microsoft software into a computer sole by the dealer as stated in regulation, it should be hold a license of Microsoft and the selling was equipped by manual, original compact disk which contained the software for backup-purposes, a end use license agreement for Microsoft software, box or package of design and logo or symbol of Microsoft, Microsoft registration card, guarantee note and certificate of authenticity. Therefore, according Microsoft, either five dealers proved of illegally hijacking by installing Microsoft software into some computer units sold to customer without

proper document, license agreement, and original disk of Microsoft. The result of DTPP was then brought by Microsoft as evidence to file a lawsuit toward the five companies. It is said that improvement on the lawsuit was firstly taken to court which happened in Indonesia. The punishment for accused defendants (the five dealers) was so high. If evident to guilty, the defendants may paying a debt to US$ 8.8 millions Such number gained from 4 year operational of the company business. During their business, they sold averaged 10-20 computer unit as daily Meanwhile prive of original Microsoft Office 2000 was US$ 599 each; whereas a package of Windows software priced to US$ 110. For the argument, Microsoft was claiming for a loss of income due to the defendant action on each unit CPU sold. If proved in court, the defendant should pay of the debt as US$ 8,8 millions. Microsoft also requested the defendant (dealer computer) to publicly declare of announcement of regret toward their action and stopping of their action such as selling without lecense, installing, distributing, reproduced and copying of Microsoft software as in illegal manner and requesting the court to seize the store and its goods contained. Fundamental regulation taken to file lawsuit was Civil Code Article 1365 CC of violating law, No.12/1997 of Copyright law and No.8/1999 of Customer Protection Act. Reasoning behind of using No.8/1999 of Customer Protection Act was inhibiting any business actor to offer products or services in any manner to customer as what so ever as if the product was legally licensed of the legal holder. Microsoft was so anxious, without proper information about validity of installed software conducted by the computer company may bring impression to customer that the product they have been bought were original. Also, according to Microsoft, it will not only harming the customer, but also it will degrade Microsoft image and its branding. It is questioned then, why only the five company taken as defendant? The Microsofts lawyer answered, it is as formality in the beginning. On lawsuit of five dealers, was not by meaning of other hijacker was set free. Microsoft has purposed to give a shock therapy to publicly announced it is a seriously issue. It is also possible for future lawsuit for other hijackers, since it is

luckly that we hold the evidence. Along with the program, such Microsoft step was emerged an indepth observation. Because, the dealer confirmed of unrelated toward the hijacking. Their argument was since beginning, they were only selling PC and its parts to any organization, whereby, in general such organizations buying into the location had their software own. It is acknowledged to those selling their products in electronic center of Harco, Mangga Dua, at Jakarta, claimed, several of their customer interest to install the software into purchased computer, but actually they admitted such used software was original one due they are not give their credibility by using an illegal product. The computer dealers eventually reach a negotiation agreement with Microsoft Corporation, although the claimant (Software Company) that actually has won its lawsuit. In the agreement, the five dealers agreed to provide compensation exceeded US$ 100,000 and 20 new PCs equipped with legal software for social purposes. They also shall make an announcement (statement) of support to be published on local newspapers.