Apparatus, method and non-transitory medium storing program for encoding moving picture

An apparatus for encoding a moving picture by an inter-layer prediction coding determines, in a first encoding process for a first layer, whether the orthogonal transformation is applied to a first sub-block, based on a feature amount indicating a localization degree level of a pixel having a non-zero value in a prediction error signal. The apparatus generates, in the first encoding process, a local decoding picture by decoding the first sub-block based on a quantized coefficient obtained by quantizing either one of an orthogonal transformation coefficient or the prediction error signal, according to a result of the determining. The apparatus generates, in a second encoding process for a second layer, a second prediction block based in part on the local decoding picture. The apparatus applies the entropy encoding to a second prediction error signal between the second prediction block and a second block, to output an encoded bit stream.