China jails counterfeiters over Microsoft fakes

Eleven counterfeiters have been given jail sentences of between one and a half and six and a half years by a Chinese court after being found guilty of producing fake Microsoft software.

The "ringleaders of the world's largest software-counterfeiting syndicate," as Microsoft described them in a statement on Wednesday, were sentenced on New Year's Eve. According to Microsoft, theirs were the longest sentences given for this type of crime in China's history.

The syndicate was charged with making and distributing more than $2 billion worth of fake Microsoft software, which had ended up all over the world. Nineteen Microsoft products were counterfeited, in 11 languages. A Microsoft spokesperson told ZDNet UK on Friday that the products had included Windows Vista and XP, as well as Office 2007 and 2003, and Windows Server.

The conspirators were identified and arrested in July 2007, following an investigation by the FBI and China's Public Security Bureau (PSB). Microsoft said in its statement that "evidence provided by Microsoft customers through the Microsoft (Windows Genuine Advantage) piracy reporting tool proved to be essential in tracking down this criminal syndicate." More than 100 Microsoft resellers helped trace the software to its origins and provide evidence.

"Microsoft greatly appreciates the work of China's PSB and the FBI in taking strong enforcement action against this global software-counterfeiting syndicate," David Finn, Microsoft's associate general counsel for antipiracy at Microsoft, said in the statement. "Unfortunately, software counterfeiting is a global, illegal business without borders. Criminals may be on the other side of the globe and may not even speak the same language, but they prey upon customers and partners all over the world. This case is a testament to the importance of Microsoft's commitment to close collaboration with government bodies and local law-enforcement agencies around the world to bring these criminals to justice, wherever they may be."

Microsoft's vice president for the Greater China region, Fengming Liu, said in the company's statement that there had been "a significant improvement in the environment for intellectual property rights in China." The country has long been widely seen as a haven for software and media counterfeiters, with one perceived factor being official laxity over the issue. Microsoft, as a company with extremely popular software, has always been a significant victim of this situation.

"We will continue to work with the relevant authorities in China to ensure that counterfeit software does not undermine the development of China's knowledge economy," Fengming said.

In November, Microsoft announced that it had decided to spend, over the next three years, in excess of $1 billion on research and development in China.

David Meyer of ZDNet UK reported from London.