The CCES in Bangkok can be reached via rob.preece@canberra.edu.au or on +66 85 829 4125

Jay Shadforth, Director, ILA

New Zealand is opening its doors to business migrants in the wake of the recent AANZFTA signing, to survive and thrive beyond the global economic recession.

The New Zealand Prime Minister John Key has made fi rm statements of his government’s commitment to keep the immigration doors open, despite the economic recession. As an entrepreneur himself, Mr Key recognises that the recession necessarily creates its own opportunities for business investment in New Zealand and that this investment and capital injection from offshore is exactly what is needed for the sustainable growth of the economy.

The Government has also been proactive in affirming ties with the ASEAN countries by building on the ASEAN-Australia-New Zealand Free Trade Agreement signed in March 2009. Consequently, the New Zealand government has taken a positive view of potential investment and business development opportunities for New Zealand throughout Asia.

BUSINESS MIGRANTS

The Government’s new business migration scheme launched 28 July 09 aims to boost economic performance by making New Zealand more attractive for business and entrepreneurial migrants. The new policy package is designed for migrants for migrants who want to invest or set up a business in New Zealand and gain permanent residence.

A summary of the two Investor Categories introduced are set out below:

Effective 28 July 09

In addition to the policies outlined above, the Government announced that a new Entrepreneur Plus Category, complimenting the existing Entrepreneur Category will be introduced in November 2009. Entrepreneur Plus offers a faster path to residence for applicants who create at least 3 full time jobs and invest NZ$500,000.00 in their business.

CHANGING THE PAST

In the past, although New Zealand’s business migrant policies have existed with the purpose of generating investment in New Zealand, they have often fallen far short of the mark, as they have been wholly unattractive to the prospective business migrant population. Now however, we will see some much needed changes to the policies that will be set with realistic requirements. These changes have come about as a direct result of the influence of a forward-thinking Prime Minister with an entrepreneurial background. According to Mr Key: “The door is open. It’s a matter of how boldly we step through it.”

New Zealand offers overseas investors a broad range of solid business opportunities with small to medium sized companies, who have a wealth of valuable experience in the New Zealand marketplace. Many of these small to medium sized companies require an injection of cash fl ow to keep their businesses going. Whilst many small to medium sized businesses and franchises have good trading records, the economic slowdown has meant a decrease in cash flow: these businesses now either seek investment or purchase.

IMMIGRATION LAW ADVOCATES

Immigration Law Advocates (ILA) has already experienced a steady rise in business migrants looking to invest in New Zealand business. This trend looks set to continue and further increase on the back of the Prime Minister’s commitment to encouraging investment and job creation in New Zealand.

Jay Shadforth established ILA in 1999 following three years of experience as an Immigration Specialist in the Christchurch legal community. Jay has maintained full membership with the New Zealand Association for Migration and Investment since the establishment of ILA and, in the first year it was offered, obtained a Certificate of Proficiency in Immigration Law and Practice in New Zealand from Massey University (2000). Her incentive to establish her own firm came from the desire to provide a professional yet personal service to her clients in appreciation of the importance of their decision not only to immigrate, but to entrust that decision to her care.

A consultant for New Zealand Immigration, ILA offers a range of services to meet the varied needs of those emigrating to New Zealand and has been serving the requirements of NZ migrants since 1999.

ILA specialises in ensuring that all New Zealand immigrants are treated fairly under New Zealand immigration policies and law. ILA immigration consultants can help you resolve any issues that you might face in your desire to stay legally within New Zealand.

While many countries close their doors to immigration due to the economic recession, it is clear that New Zealand is paving the way forward in its bold move to encourage investors and business migrants.

Website: www.immigrationlaw-nz.com

Reprinted in full from Australian ASEAN Business

AISM commenced operation in the year 2000 and is staffed with highly experienced and well qualified Australian and international teachers. Currently, the school has over 550 students from more than 30 nationalities.

AISM places strong emphasis on extra-curricular activities. Students of the school are able to participate in a wide range of indoor and outdoor activities including Soccer, Swimming, Touch Football, Karate, Chess, Mask Making and Video Making. Participation in community programs is also encouraged whereby students have raised funds for local charities through the International Award (Duke of Edinburgh Scheme) and Student Representative Committee. The most recent fundraising was for the Australian bushfire victims where a number of activities have been organized by the school community to channel funds to the victims.

Eagerness to learn and enthusiasm to be participants in a learning and supportive community are qualities we work to develop and strengthen in our students. We encourage them to adopt the philosophy that learning is a lifelong experience, not just in the classroom but in everything we do. Many of the staff are involved in personal higher learning, completing higher degrees as they work. For the students to see this sends a powerful message that we genuinely believe in what we teach. Visit us at www.aism.edu.my

FACTS

This case involves a dispute between the plaintiff, a popular singer and songwriter known as Tanya Chua, and the defendant, a music publishing company named Music & Movements (S) Pte Ltd, in that songs that the plaintiff composed exclusively while under contract for the defendant, are no longer owned by the defendant upon the expiry of two agreements signed between the parties.

On 18 September 2002, the plaintiff signed an agreement with the defendant agreeing to compose songs exclusively for the defendant for a period of three years with the option to renew the contract for a further period of three years by mutual agreement. The plaintiff was then paid royalties for songs composed during the duration of the contract after minus the costs incurred and commission. The plaintiff was also advanced a royalty payment of S$20,000.

On 25 May 2005, the plaintiff signed a second agreement with the defendant, extending the first agreement to at least 17 March 2007. The plaintiff was also advanced S$40,000 as a royalty payment. A clause in the contract allowed the plaintiff to either extend the contract with the defendant by mutual consent at the expiration of the second contract, or cease the agreement upon its termination.

ISSUES 

Whether the rights in the composition reverted back to the plaintiff after the termination of the second agreement on 17 March 2007:

The plaintiff asserted that the rights to her compositions reverted back to her at the expiration of the second agreement on 17 March 2007. However, as a gesture of goodwill, she allowed the defendants a final extension till 30 June 2007. She sought to rely on two grounds: (1) that the accounting problems of the defendants, which were not remedied within 30 days, made them in breach of clause 12 of the first agreement which enabled the plaintiff to terminate the contract and (2) that under clause 5 of the second agreement, the rights of the defendants over the Compositions should cease after termination.

With regards to the first ground, the defendant pointed out that these errors had actually benefited the plaintiff, as it oversaw the deduction of withholding tax for royalties due to the plaintiff, thus resulting in the plaintiff receiving more royalties than she should have. He also disputed the defendant’s claim that she only found out about the errors in the email dated 3 April 2008, pointing out that she had already raised the issue in her email dated 14 November 2006, and that they had gone out of their way to let the plaintiff’s solicitors and accountants inspect their books on 23 August 2007, fulfilling their obligations under clause 12 of the first agreement. Furthermore, the plaintiff had been made aware of the timelines relating to the receipt of periodic statements of accounts from Warner-Chappell. There had always been full and complete accounts given to the plaintiff and the overpayment discrepancies were explained to the plaintiff’s solicitors.

With regards to the second ground, the defendant explained that that according to industry practice, in instances whereby a songwriter signed with a new publishing company, rights to songs composed exclusively under the previous publisher would have to be bought over by the new publisher if desired, thought it was still the original publisher’s prerogative to relinquish its rights. A letter from the general manager of Universal Music Publishing Malaysia & Singapore was used to confirm this. 

DECISION

Relating to the first ground, the court found that the accounting discrepancies had already been resolved with the plaintiff in December 2006 and that the defendant had fulfilled its obligations in allowing the plaintiff to examine its accounting books. The plaintiff had insufficient grounds to rely on clause 12 of the first agreement.

Relating to the second ground, the court opined that no cogent arguments were raised against clause 6 of the second agreement that the defendant’s rights to the plaintiff’s compositions would survive the expiry of the contractual agreement.  The plaintiff would continue to receive royalty payments in perpetuity for the compositions assigned to the defendants.

The court dismissed the case with costs to the defendants.

COMMENTARY

A well drafted contract is difficult to overturn especially one which is rooted in industry practice.  Recording companies and artistes should closely scrutinize their contracts at the drafting as the nature of the music business is such that a fledgling artiste has the potential to become a major money-spinner overnight.

Coram: Andrew Ang J

FACTS

The defendant in the case is a company, AspenTech Inc. The plaintiff is Goh Guan Chong, a former employee of the defendant. The dispute arises out of a clause providing for a sign on bonus in the contract for employment. 

The plaintiff’s case

The employment contract between the plaintiff and the defendant stated that the plaintiff would receive a sign-on bonus of US$200,000 upon signing the contract to compensate the plaintiff for the loss of his stock options as ATOS (his previous employment). It would be paid to him in twelve quarterly instalments starting March 2001 and ending December 2003. The contract stated that the sign on bonus would be paid in full if he did not leave the defendant voluntarily. If he did, he was liable to full repayment of the sign-on bonus. This was confirmed by the Human Resource Director of the defendant, Amy Lau. Upon such representations, the plaintiff signed the formal letter of employment and commenced employment with the defendant on 1 February 2001.

The plaintiff claimed that there was no dissatisfactory response about his conduct. However on 10 July 2001, the plaintiff attended a meeting with his immediate boss (John Ayala) and Amy where he was informed that the defendant would be terminating his employment contract. The plaintiff was asked to sign a letter of resignation and a payroll calculation which included a “Notice pay” of $80,010, but omitted the sign on bonus and the variable bonus. He highlighted his concerns and Amy offered to enquire about the matter. Subsequently, the sum in the payroll calculation was credited to the plaintiff without his knowledge.

The defendant’s case

The defendant’s case defers in the following aspects:

• (1) That the sign on bonus was to retain the plaintiff in his employment until the end of the employment period and not to compensate the loss of his ATOS stock options. Thus the sign on bonus payments accrued quarterly and not immediately upon entrance into employment.
• (2) That the plaintiff was not terminated, but resigned voluntarily.
• (3) That the plaintiff had agreed to the terms in the 2 documents presented to him after the meeting on 10 July 2001.

ISSUES

The court had to consider the following issues:

• (1) Whether $80,010 was paid in full and final settlement
• (2) Whether the plaintiff resigned from employment on 10 July 2001
• (3) Whether the plaintiff was entitled to the remaining of the sign on bonus payment of $290,000 if he had not resigned
• (4) Whether the $290,000 was payable on 10 July 2001

DECISION

Regarding issue 1, it was held that the $80,010 was not for the full and final settlement of all the issues between the parties. This was because the defendant had never referred to the sum as the full and final settlement, but rather, merely as details of the final pay calculations. Furthermore, the resignation and payroll calculations documents were not signed, indicating that the plaintiff did not agree to them. Upon cross-examination, Amy also conceded that the plaintiff had not agreed to accepting the S$108,989.62 as a full and final settlement and to not receiving the remainder of his sign-on bonus.

Regarding issue 2, it was held that the plaintiff had not resigned, but was terminated. According to the court, the defendant’s willingness to pay the plaintiff the 3 months notice pay of S$80,010 indicated that it was unlikely that the plaintiff resigned. If he did, there was no need to give the 3 month notice pay. The final indication that he had his employment terminated was in a letter from the defendants solicitors to the plaintiff dated 28^th September 2006 that stated “As your client’s employment had been terminated, he is not entitled to further instalments of the sign-on bonus”.

Regarding issue 3, it was held that the plaintiff was entitled to the sign on bonus as soon as he entered into employment with the defendant. The meaning of the word ’sign-on’ means ‘to join’. Thus, full sign-on bonus was already entitled to him upon commencement of his employment. The quarterly instalments merely referred to the method of payment. It was also reasoned that the sign-on bonus was a crucial consideration behind the plaintiff signing the employment contract and that it would not have made sense in the plaintiff agreeing to the contract when the defendant could rob him of the bonus just by terminating his contract.

Regarding issue 4, it was held that the sign on bonus would be paid in accordance with what they agreed, i.e. in quarterly instalments with interest at 5.33% until full payment.

Accordingly, the court found in favour of the plaintiff.

COMMENTARY

The court will interpret the obligation to pay contractual bonuses strictly and a bonus does not mean a discretionary payment unless expressed to be so. Clauses awarding bonuses should therefore be carefully drafted.

The client would require guarantees, performance bonds and export letters of credit. Plus the involvement would allow ANZ Vietnam to support the project and develop a relationship with local partners. Negotiations were soon underway. An opportunity now exists for ANZ to help clients at both ends of the transaction and develop new relationships in the region.

This is one example among many of how the bank’s on-the-ground presence in members of the Association of Southeast Asian Nations (ASEAN) is helping more and more organisations wanting to do business with Australia and vice versa.

“It’s becoming increasingly important for businesses buying from or selling to ASEAN countries to tap into the kind of market intelligence our knowledge and expertise can deliver,” says Alan Huse, ANZ’s Australian Head of Trade and Supply Chain.

Strong franchises

The ANZ network covers many of the ten members of ASEAN, either via full branches or in some cases through partner banks. It has strong franchises in most of these countries, some of the more prominent ones being in Indonesia, Vietnam, Malaysia, Cambodia and Laos.

In these member countries, too, the bank combines traditional trade solutions with structured advisory, including trade risk management, fund raising and financial markets. The work of the relationship managers is complemented by operations and trade sales and services teams.

Building relationships

The depth and reach of its presence allows ANZ to provide more – much more – than routine trade services. If a client in Indonesia is exporting to Australia, for example, ANZ can help its people to understand the market they’re dealing with, explains Alan Huse. On the other hand if the bank has an Australian client importing from Indonesia or selling to them, it can make them aware of potential pitfalls and gain valuable market intelligence on their behalf from its Asian offices.

Often such arrangements lead to new business opportunities. For one client this year, ANZ issued a series of documentary credits to facilitate the purchase and import of equipment to build a biodiesel plant in Malaysia. It has since helped its partner bank facilitate a relationship with that company.

Gearing for growth

The demand for this kind of help is growing along with the burgeoning importance of ASEAN countries to Australia.

Despite the slowdown in trade volumes in recent months resulting from the global downturn, ANZ’s Asian business has continued to experience strong growth in profit and revenue, says Alan Huse. The effects of the financial crisis have been offset by the acquisition of more customers and general expansion of the business. Indeed Asia remains the key growth platform for ANZ.

“We believe Asia will not only survive the current crisis but come out of it sooner and stronger than the Western world,” says Alan. “Since the Asian crisis of the ‘90s, ASEAN countries have made great progress in getting their economies in better, more stable shape with continued strong demand for domestic infrastructure and consumption.”

At the same time they’ve experienced big expansion in manufacturing, particularly in Vietnam and Malaysia. Vietnam has attracted many Taiwanese and Korean companies which have moved their manufacturing base from China. This shift is likely to accelerate in Indochina for the same reason these businesses moved to China 10 to 15 years ago – relatively cheap, hard-working, skilled workforces.

The economic strength of ASEAN countries and other Asian nations is of vital significance for Australia and a prime reason trade is such a key product offering for ANZ, says Alan Huse. The Asian clientele includes traders in countries that manage huge import and export volumes. “With our trade capabilities in the region and a trade team in every country, structuring and managing trade finance solutions for clients while managing the cross-border risks is obviously of key importance.”

Cutting paperwork, saving time

As customers can attest, ANZ’s web-based trade processing services platform provides a distinct competitive advantage by simplifying the movement of documents. This cuts paperwork associated with trade flows and saves time and money. A “point-of-destination” processing approach to documentation can benefit exporters who may have annual turnover held up by payments due on shipments they’ve already made.

ANZ’s capabilities have been acknowledged by many recent awards including Global Finance Magazine’s Best Trade Finance Bank in Australia (2009). Accolades in 2008 included Finance Asia Magazine’s Commercial Bank of the Year prize.

In its trade proposition another essential business is structured export finance – working at the longer end of the trade curve. In this ANZ works closely with entities such as EFIC, the Australian federal government agency that promotes and finances Australian exports together with its counterparts in other parts of the world.

“We’ve been closely involved in that business in ASEAN countries, helping to arrange deals and pulling the balance of financing together,” says Alan. “This is a tool more common in Asia where developing economies need access to long-term capital and can’t get it easily.”

At the heart of the ANZ offer, as always, is a desire to understand clients’ businesses, the political and social issues they face in marketing their products overseas and being flexible about creating solutions. “And it’s still one of the main reasons any company dealing with ASEAN countries should consider us,” says Alan Huse.

Coram: Tay Wong Kwang J

FACTS

The plaintiff was a company incorporated in Germany called Muhlbauer AG, owner of patent number 117982 entitled “Device for Inspecting and Rotating Electronic Components”, of which it is the registered proprietor. The patent, was granted by the Intellectual Property Office of Singapore, and has been in full force in Singapore since the 16^th of February 2004.

Description of the plaintiff’s patent

The patent describes a machine for picking and placing electronic components onto printed circuit boards. Due to increasing demand for electronic devices, it was necessary for company’s to increase speed, thus increasing throughput, without decreasing accuracy. Earlier models of the machine involved a two part process before an electronic component was placed on the substrate.

The first part involved the picking up of an electronic component with a single pickup head, and inspection of the component to determine its position and orientation with a camera. This resulted in time wastage due to the need to move the component underneath a camera head for inspection. The second part of the process was the actual placement of the component on the substrate.

The plaintiff’s patent, however, describes a machine, with two pickup heads arranged opposite each other, with one first picking up a component, rotating it 180 degrees, which time inspection is done concurrently, and transferring it to the other pick up head, which then places it on the substrate. Through this method cycle time is greatly reduced, thus increasing throughput.

The allegation

The plaintiff disputes that the defendant, a Singapore company called Manufacturing Integration Technology Ltd infringed on the patent by making, disposing of, offering to dispose of, using or importing the patented product and/or keeping the patented product. The plaintiff also complains that the defendant has manufactured and marketed a device that inspects and rotates electronic components concurrently, a machine that is distributed under the trade mark “CAERUS”.

The defendant’s case

The Defendant acknowledges that it has infringed upon the plaintiff’s patent in that its machine rotates and inspects electrical components concurrently. It, however, disputes that the plaintiff’s patent the critical elements for the validity of the patent, i.e. novelty and the inventive step. As such, it is invalid.

The defendant sought to invalidate the plaintiff’s patents with the use of an expert witness, John Briar. 4 existing patents were relied on: the ASA patent, the Matsushita Patent, the National Semiconductor patent and the Shinkawa Patent. The 4 mentioned patents clearly anticipated the main features of the plaintiff’s patent, thus invalidating it.

The ASA patent describes the use of more than one pickup head and concurrent motion reduces travelling distance and increases throughout, stating that a vision system could be used to inspect the chip, the basic concept behind the plaintiff’s patent, and is well understood and has been clearly documented since the 1990’s.

The Matsushita patent describes the placement of several pickup heads being arranged such that there would be openings between them through which optical inspection could be maintained during inspection.

The National Semiconductor patent describes the use of several pickup heads on a rotary wheel to achieve an increase in speed, and the concept of a vision system that could inspect a component through and opening in the pickup head.

The Shinkawa Patent describes details of flip chip bonding apparatus through which vision alignment could be maintained through the picking up and rotating of a component.

Based on these four existing patents, the defendant, with the help of its witness, argued that the plaintiff’s patent failed on two critical elements governing patentable inventions, in that the concept was not new, thus, lacking novelty, and did not involve an inventive step.

ISSUE

The court had to decide on the issue of novelty. The guiding principles in determining novelty were set out by Justice Lai Kew Chai in Trek Technology (Singapore) Pte Ltd v FE Global Electronics Pte Ltd (No. 2) (see [16]).

Decision

The court accepted the views of the Defendant’s expert witness. In addition, it was stated that the fact that a product sells well does not mean that it is novel or one involving an inventive step.

It was concluded that the plaintiff’s invention was not, an invention, but an efficient utilisation of technology and concepts that had already been anticipated by former patents, in order to increase speed. The plaintiff’s patent, was thus declared invalid.

The defendant succeeded in its counterclaim that the plaintiff’s patent lacked novelty and an inventive step and the plaintiff was ordered to pay the defendant the costs of the trial on liability.

Commentary

This case indicates the difficulties surrounding patent law and deciding issues of novelty and inventive step. The role of the expert witness in patent cases is often critical, as was in this case.

]]> http://www.aanzbusiness.com/singapore/muhlbauer-ag-v-manufacturing-integration/feed/ 0 http://www.aanzbusiness.com/technology/atm-card-fraud-and-bank-liability/ http://www.aanzbusiness.com/technology/atm-card-fraud-and-bank-liability/#comments Tue, 16 Jun 2009 00:45:37 +0000 keystonelaw http://www.aanzbusiness.com/?p=315 The recent UK case of Job v Halifax plc brings to spotlight the apparent infallibility of the chip and PIN system. It also shows the likelihood of increased liabilities that banks will have to face for card fraud cases.]]> Chip and PIN Card fraud at ATMs

The recent UK case of Job v Halifax plc brings to spotlight the apparent infallibility of the chip and PIN system. It also shows the likelihood of increased liabilities that banks will have to face for card fraud cases.

Before: Burden of liability taken up by consumers

Before, banks like Halifax could hide behind the facade of the security track record of the chip and PIN system. When a disagreement over Automatic Teller Machines (ATM) card usage arose, banks made their case on grounds that ATMs could not transact without a valid card and PIN number. The security of one’s PIN number was usually the responsibility of the cardholders. Unexplained withdrawals were regarded as a result of the cardholder somehow allowing his or her PIN to be compromised.

This meant that the burden of bearing the liability of card fraud was more often than not taken up by the consumer through the bank’s claims of cardholder’s negligence.

Case to note: Job v Halifax plc

However, the advent of this case might change the way things are bring run. Alain Job, the plaintiff, is suing his bank in order to obtain a refund over of £2100 in phantom withdrawals from his account. Fraudsters withdrew the money from his account at ATMs, even though he maintained that he had been in possession of his card at that point of time. He would assert that the bank must have known this judging from his withdrawal patterns. Halifax, his bank has since insisted that whoever withdrew the money from his account had in possession the ATM card (which has the apparently secure chip and PIN system) as well as Job’s secret pin.

Impact on the banking sector

If the courts subsequently decide for Job, it would be upheld as an acceptance of the notion that the chip and PIN is not entirely secure, and that harvesting and cloning of bank cards is possible. Banks like Halifax cannot no longer claim cardholder’s negligence and refuse to take up any liability for the losses when they knew such losses could have arisen. This means that more cases of disputed withdrawals from ATMs will surface.

However, an unfavourable outcome for Alain Job will not exactly be a cause for cheer for the banks. With increasing demand for evidence exchange from both parties, banks will start having to produce evidence to the cardholder plaintiff of the disputed transaction. Such evidence includes authentication data of the disputed transactions.
Previously, in most cases of card fraud, banks usually are unable or unwilling to produce authentication data. With greater amount of information, the ability of the genuinely aggrieved to build his case is stronger.

Therefore, banks are likely to have to start taking greater responsibility in promoting the development of secure electronic banking technology.

Scots College’s purpose is to give each young man a life long commitment to education and to provide the environment in which he can achieve his academic, spiritual, physical, cultural and social potential for the greater good and in service to others. Scots College is a modern learning institution, equipped with first-class facilities and technology embraced in all facets of its curriculum. An excellent academic record reflects an emphasis on learning and high expectations of student achievement.

Boarding

Scots College offers both 7 day and 5 day boarding for boys from Year 7 to Year 13. A Boarding School education equips young men with self discipline and independence, organisational skills and an understanding of community living – and fosters friendships that last a lifetime. Boarding at Scots College attracts secondary school students from New Zealand and students from Asia and Europe. The recently refurbished and extended boarding house is well equipped with modern facilities appropriate to the needs of 60 boys. Common facilities include the College dining room and a common room equipped for various leisure activities. The library, computer and sports facilities are also available for boarders outside normal school hours.

International Baccalaureate (IB)

Scots College has recently begun the implementation of three International Baccalaureate (IB) programmes. The Primary and Middle Years Programmes were introduced in the Prep School and Secondary School in 2008 and the IB Diploma will be offered to Years 12 & 13 as an alternative qualification from 2010. Scots College decided to offer IB for a number of reasons:

The pedagogical approach of IB is modern and inclusive. It encourages an   interdisciplinary approach to study with students taking a broad range of subjects including a compulsory foreign language.

The curriculum promotes inter-cultural awareness and environmental themes both of which will be increasingly important to students in the future.

The IB programmes offer an internationally acceptable and portable qualification which suits many of our families who travel and live overseas. Increasingly more of our students will study internationally.

Scots’ Culture

The culture of family is a strong part of College life. In both the Preparatory and Secondary Schools each student is a member of a House. The House staff provides pastoral care, academic support and guidance to the boys during their years at school. A strong loyalty to their House develops as boys compete in sporting and cultural interhouse competitions.

Scots is proud of the quality education it provides, in a single sex environment. Much research has been carried out that verifies the differing learning styles of boys and girls. Scots is unashamedly a boys’ school. Programmes are tailored to meet the learning needs of young men whether this is in the college structures, such as the House system or the curriculum organisation, such as sustained silent reading. Recent educational data shows students in single sex schools achieve at a higher level. Scots has the best of both worlds with its strong relationship with sister school Queen Margaret College, which enables students from both schools to interact socially and in competition on a regular basis.

Learning. For life.

Here at Scots College we believe that education is a gift. Today’s parents are striving to provide their children with not only a higher standard of living and material items, but are also seeking to offer them the best education they can – an education that will equip them well for their future. A quality education will ensure that our young people are given the best opportunities in life. Scots College has a culture of excellence, and focuses on providing an all round education; providing the knowledge, skills and values that will ensure each individual achieves his potential and is equipped to enter the complex and challenging world ahead of him.

Nevertheless, a recent proposal to extend the EU’s principles of consumer protection rules to cover licensing agreements of products like software downloaded for virus protection, games and other licensed content will change all this.

Consumer protection laws within the EU

Sellers of consumer goods have to guarantee the conformity of their products with the contract for a period of two years after the delivery of the goods. The final seller, who is responsible to the consumer, can also hold the producer liable in their business relationship.

Goods are presumed to be in conformity with the contract if they:

• 1. comply with the description given by the seller and possess the qualities of the goods which the seller has held out to the consumer as a sample;
• 2. are fit for any particular purpose for which the consumer requires them and which he made known to the seller at the time of conclusion of the contract and which the seller has accepted;
• 3. are fit for the purposes for which goods of the same type are normally used; or
• 4. show the quality and performance which are normal in goods of the same type and which the consumer can reasonably expect, given the nature of the goods and taking into account any public statements on the specific characteristics of the goods made about them by the seller, particularly in advertising or on labelling.

If the goods are not delivered in conformity with the sales contract, consumers can ask for the goods to be repaired, replaced, and reduced in price or for the contract to be rescinded.

Extension of consumer protection rights to software

The standards for assessing the conformity of the software product would most likely mimic that of tangible goods. This means software makers and sellers will have to ensure that their software comply with any description they represent to the consumer, the purpose that the consumer requires them to be in, the purposes for which similar software are normally used, the quality and performance that the consumer can reasonably expect.

Further, software makers and sellers will have to repair, replace, reduce the purchase price, or provide a full refund to the consumer if the software is not delivered in conformity with the standards set out in the contract. 

Impact of such an extension of consumer protection laws

Greater rights for consumers

The adoption of this extension by within the EU will provide consumers with greater rights and a peace of mind when purchasing software. Previously, these consumers could only rely on the guarantee of a software writer/manufacturer to the usability of his product (which is often absent). With this, consumers have a right to get their software that works with fair commercial conditions. 

Software makers and vendors beware

However, software writers and sellers within the EU will have to undertake a greater responsibility for their products. They would be obliged to provide a longer period of guarantee for the efficacy and security of their products.

Increased costs of software borne by the consumer

Naturally, software manufacturers will face additional costs in producing software. Some of these costs include the purchase of expensive insurance to cover their liability from any defective software and the increased costs of researching and developing software before product release. These additional costs will inevitably be transferred to the customer.

Limitations in enforceability of the proposed legislation

There are limitations in enforcing such legislations within the EU. This is because the performance of software is highly dependant on many factors including, inter alia, the environment the software is operating in, how the code is updates, and whether it is possible to adapt and modify the software. The diverse environments in which software are being used will affect the enforceability of the consumer protection laws.

Also, there is a significant number of open source software. The very open and shared nature of open source software development will make it difficult to attribute liability to a particular writer for a failure in a software application.

It remains to be seen whether this proposal to extend consumer protection laws to consumers is beneficial. It is suggested here that even if it comes into practice, this should only apply to paid software. This is because one can have a reasonable expectation of the fitness of the software that comes with payment. This will allow freeware writers to test new software in the market without worrying about the potential legal costs that they cannot afford.