FIRMS risk infringing copyright laws because workers accessing software online are unwittingly downloading pirate programs for use from overseas websites.

Tough new penalties have been brought in under the new Copyright & Trade Marks Act - as the risk of infringing the law is increasing.

The maximum penalty for copyright-related offences has now been raised to 10 years in prison and/or an unlimited fine.

Courts can also order the infringing goods to be forfeited in all cases.

"Of particular significance for businesses is the change to the definition of 'illegal software'," warns Joe Johnson of Moore & Blatch Solicitors.

"Not only does this cover pirate copies, but also unlicensed duplicates downloaded onto PCs.

"This will include illegal downloads which are commonly available on-line from overseas sites, and which are easily downloadable by unsuspecting employees without the knowledge of their employer."

Latest data suggests that around 2.4 million Britons have infringed copyright. One-in-three software applications are being used in the home and the workplace illegally.

The new Act gives police the power to secure warrants to search and seize property from any business they believe is using unlicensed software.

This change in the law significantly extends previous powers which limited searches to traders and importers of illegal materials.

"Until the Act is actually implemented and used, it is difficult to assess its likely effect.

"However, businesses have to be aware of the products being used by employees, and ensure that their audit procedures are updated to take account of the legislation."