In an effort to comply with Australia's obligation under the Australia-United States Free Trade Agreement, a legislation was proposed to prohibit the use of devices and services that circumvent Technological Protection Measures or TPM. When the new law by the Australian Federal Government takes effect, users of mod-chipped videogame consoles could face fines of up to AU$6600. The distributors of said devices in turn could face fines of up to AU$65,500 and/or up to five years of jail time.

The law covers "distribution, offering, provision and communication" and it no longer has to be "in the course of trade."

The short of that very legalised paragraph is this: when the law takes effect on the first of January 2007, all mod-chipped devices would be deemed illegal. Even journalists and bloggers could possibly face fines and jail time for writing about mod-chips or other methods of breaking copy protection systems.

Word of the legislation came for law firm Minter Ellison and a draft of the legislation was released for public comment earlier this week. A sharp user at CNET has inquired about what happens to users of devices that were already modded while they were legal? Are the citizens required to dispose of the devices? Are those users exempt? Does the law only apply to "newly-modded" chips?

Officially, there are exemptions to the law. The lucky ones are those who use mod chipped devices for computer security testing, law enforcement, and libraries. For the rest of the imported dvd game/movie using, homebrew loving Aussie folk, really sorry mates, you'd have to say good-bye to those modchips come the new year.

We'll do our best to keep you updated about the situation.