Optical disc law proposed

Companies that manufacture, duplicate and export VCDs, DVDs and music CDs will now have to obtain licences to do so.

Strict licensing norms have been proposed in the draft optical disc law prepared by the Ministry of Information and Broadcasting in consultation with disc-manufacturing companies and the Federation of Indian Chamber of Commerce and (Ficci).

Currently, there are no regulations governing the manufacture, duplication and export of discs. The proposed law will be applicable to pre-recorded discs and also to blank optical media (discs).

According to industry estimates, India produces 350 crore units of discs and CD-drivers annually that are used to produce music CDs, film DVDs and video CDs.

The Rs 1,500-crore disc-production market is expected to reach Rs 6,000 crore by 2010, but the mounting losses as a result of piracy has forced the government to come up with this law.

According to the draft law, there will be separate licences for the production, duplication and export of discs.

"This means that the company which gets a licence to manufacture can not export and those who get the licences for export may not manufacture," a senior Moser Baer official said.

Once passed, the law may result in music companies like T-Series, Saregama, and Yash Raj Films applying for multiple-location licences. Currently all these companies not only manufacture their own CDs but are also engaged in commercial duplications.

According to one of the provisions of the draft law, the government will constitute an independent competent authority on the lines of the Telecom Regulator (Trai).

This authority will not only issue licences to the companies for manufacturing or export of any recordable devices, it will also have the rights to inspect and confiscate any equipment for a period of 30 days.

"The competent authority will also have the right to cancel any licences of the companies if any of its officers, directors, managers, shareholders, or partners, commit an offence involving registration conditions covered under the law," a I&B ministry official said.

Welcoming the law, Ratul Puri, executive director, Moser Baer India Ltd, said the industry needs strict regulations for manufacturing of discs and the optical disc law will solve the menace of piracy.