In a court case that was brought on by Sony Computer Entertainment back in 2001, a bench of six judges of the Australian High Court held that mod-chips were legal and not, as Sony argued, among devices outlawed by the copyright act.
The interesting thing about this court case is that one of the arguments used was that region-coding was detrimental to consumer choice, and that "Sony's protection technology created artificial trade barriers between Australian and overseas games and DVD markets".
This ruling could be short lived due to changes to copyright being brought about by the Free Trade Agreement with the United States due to take effect in 2007.
The full news article makes an interesting read.
Link:
Mod-chips ruled legal (AustralianIT)
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