The entire legislative process has already been completed for an amendment to Act No. 121/2000 Coll., on Copyright, on Rights Related to Copyright and on the Amendment of Certain Acts (the Copyright Act). This is an extensive amendment to the Copyright Act, which contains, inter alia, important changes for the area of legal relationships related to computer programs. Some of these changes are of a fundamental nature and more detailed information about them would need to be elaborated in several articles. This contribution focuses on certain selected issues.
At the outset, it may be generally assessed that, contrary to certain previous trends in the field of intellectual property rights, this amendment paradoxically (albeit perhaps not entirely intentionally) strengthens to a certain extent the position of end users of computer programs vis-à-vis software companies (rights holders).
Method of Conclusion of Contract
In the distribution of boxed software, but also in the distribution of computer programs via the internet (including free software, freeware, etc.), situations arose in practice that were problematic from a legal point of view, where a proper conclusion of a licence agreement, which the Copyright Act presupposes for the granting of a licence, did not occur - see Section 12(1) of the Copyright Act “The author has the right to use his work … and to grant another person by contract authorisation to exercise this right; another person may use the work without the granting of such authorisation only in cases stipulated by this Act.” The requirements for proper conclusion of a contract were not regulated by the Copyright Act prior to the entry into force of the amendment in question, and the general regulation of the Civil Code was applied to the contracting process. In simplified terms, it may be stated that a valid conclusion of a contract pursuant to the provisions of the Civil Code may occur in such a manner that one party (the proposer) makes a specific proposal to a specific person (persons), the other party accepts this proposal without reservations, and the acceptance is subsequently delivered (communicated) back to the proposer. As is generally known, this process is not always fully fulfilled in practice in the distribution of software.
The amendment responds to this situation by adding provisions of Section 46(5) and Section 46(6) to the Copyright Act, which modify the above-outlined model of contracting under the Civil Code. The new regulation applies to all subjects protected by copyright and not exclusively to computer programs. The contract as a universal method of granting a licence to software, however, remains even despite the changes made. The added provision of Section 46(5) of the Copyright Act reads “A proposal is made even where the manifestation of will is directed also towards an indeterminate circle of persons.” This is the same regulation as for the so-called public proposal of a contract under the Commercial Code, with the substantial difference that a public proposal of a contract under the Commercial Code must be expressly designated as a public proposal of a contract, whereas the Copyright Act does not stipulate such a condition. In the area of copyright law, a proposal to conclude a contract need not be addressed to a specific person (specific persons) and need not be designated as a public proposal. The definiteness of the proposal of the contract suffices, provided that it indicates the proposer’s will to be bound by it. For these reasons, it is therefore advisable to pay attention now, for example, to the formulation of licensing terms stated on the licence provider’s website, so that it is clear what constitutes a proposal to conclude a contract and what does not. It is not excluded that the provider will not wish to conclude a licence agreement with all persons as the Copyright Act presupposes (e.g. with competitors).
In this context, the new provision of Section 46(6) of the Copyright Act is very interesting, which reads: “Having regard to the content of the proposal or to the practice which the parties have established between themselves or to customs, the person to whom the proposal is addressed may express agreement with the proposal to conclude a contract by performing a certain act without notifying the proposer, by acting in accordance with it, in particular by providing or accepting performance. In this case, the acceptance of the proposal is effective at the moment when this act was made.” This is an analogue of Section 275(4) of the Commercial Code. From the conjunction with the above-mentioned Section 46(5) of the Copyright Act, it follows that the proposer of the contract (provider of software) need not theoretically learn from now on that he has concluded a contract and who is the other contracting party. For the area of free software, such a change is beneficial; however, in the area of so-called proprietary software, the assessment will probably not always be so clear-cut.
Use for Personal Needs
There has naturally been no change in the most important issue related to software (even despite the amended wording), namely that the use of computer programs (or databases) for the personal needs of a natural person is not free use within the meaning of the Copyright Act. For most copyright works, use for personal needs is free use. The amendment in question elaborates this issue in Section 30(2) more than in the original wording of the Act: “Unless this Act stipulates otherwise below, use under this Act is the use of a computer program or electronic database even for the personal needs of a natural person or the own internal needs of a legal person or a natural person conducting business, including the making of a reproduction of such works even for such needs…” For the avoidance of doubt, the Copyright Act then states in Section 66(2) that “Reproduction of a computer program under this Act is also deemed to include the making of a reproduction if it is necessary for loading and storing the computer program in the memory of a computer, as well as for its display, operation and transmission.”
From the above, it might appear that even for the use of a computer program for personal needs it is necessary to obtain authorisation to exercise the right to use the computer program, i.e. to obtain a licence from the provider for this computer program (as was the case under the original wording of the Copyright Act). However, the Copyright Act now newly provides the possibility to use a computer program even without obtaining a licence from the rights holder (see below).
Authorised User of a Reproduction of a Computer Program
The amendment to the Copyright Act introduces in Section 66(6) a definition of a person who is a so-called authorised user of a reproduction of a computer program. The incorporation of this definition into the legal order is not a consequence of the harmonisation of Czech law with EC law, but rather represents our legislator’s own initiative. The minimum rights of an authorised user of a reproduction are laid down in Section 66(1) of the Copyright Act (this regulation follows on from the original wording of the Act in individual points). Under letter b) of this paragraph, it is then newly stated that an authorised user of a reproduction of a computer program does not infringe copyright if he “…reproduces, translates, adapts, modifies or otherwise changes the computer program, if it is necessary to utilise the lawfully acquired reproduction of the computer program in accordance with its intended purpose…”.
Having regard to the fact that every authorised user of a reproduction of a computer program is entitled to such use (unless otherwise agreed by contract), the mentioned definition of the term authorised user of a reproduction of a computer program from Section 66(6) of the Copyright Act gains in importance “An authorised user of a reproduction of a computer program is an authorised acquirer of a reproduction of a computer program who has ownership or other right to the reproduction of the computer program, for the purpose of its utilisation, not for the purpose of its further transfer, furthermore an authorised acquirer of a licence or another person authorised to use the reproduction of the computer program.”
The authorised user of a reproduction of a computer program may therefore be the following subjects:
a) an authorised acquirer of a reproduction of a computer program who has ownership or other right to the reproduction (other right may be understood to mean, for example, a right of lease, etc.), for the purpose of its utilisation, not for the purpose of its further transfer;
b) an acquirer of a licence (here the situation is clear);
c) another person authorised to use the reproduction of the computer program. - In this case, it should therefore not be a person authorised to use the computer program (e.g. an acquirer under a sub-licence agreement), but rather a person authorised to use the reproduction of the computer program; however, such a person is already mentioned once under point a) as a person who has “other right to the reproduction”. It should probably also not be an employee of the acquirer of the licence, who may indeed have factual access to the reproduction, but acts in representation of the employer and not in his own name.
From the above, it follows that in order to use a computer program (on our territory), it is not always necessary to conclude a licence agreement. If, together with ownership of the reproduction of the software, it is possible to obtain, on the basis of the Copyright Act, authorisation to use this software (in the case that it concerns an “authorised acquirer”), questions naturally arise as to whether this regulation is not in conflict with the obligations arising for the Czech Republic from international treaties on the protection of intellectual property, etc.
Having regard to the above, the requirements for caution in providing reproductions of computer programs on the part of software companies are thus substantially increased. This naturally does not mean companies which are engaged only in the “sale” of boxed software, which reckon with the fact that once a reproduction is distributed it will be further transferred and used (for these, the amendment does not signify substantial changes in distribution models), but rather especially companies which are engaged in the development of their own not entirely unified software solutions. Interesting in this context may also be the issue concerning the handling of reproductions of software which are located with third persons on the basis of contractual arrangements arising before the entry into force of the amendment. For instance, if a provider of a software solution has, in addition to the granted licence, handed over to the acquirer several reproductions of the software and has not regulated in any way the issue of handling these reproductions (under the current regulation he need not have had any concern that another person could use the software), it is not excluded that the authorised acquirer of these reproductions may lawfully transfer ownership rights to them (or lease them) and the new owner of the reproduction will thereby acquire authorisation pursuant to Section 66(1) of the Copyright Act (i.e. authorisation to use the software). If the above-mentioned provision of Section 66(6) of the Copyright Act appears to the reader to be incomprehensible or illogical, it need not necessarily be a fault on his part. The case law of the courts or further amendment may possibly contribute to resolving the outlined issues.
In conclusion, we note that this contribution cannot by any means cover the scope of the amendment to the Copyright Act, not even in relation to computer programs. Further changes occur, for example, in the area of so-called employee works and so-called technical means of protection of rights, etc.
This text was translated from Czech to English using an AI translator.