CELEX: 51988PC0816
Language: en
Date: 1989-03-17
Title: PROPOSAL FOR A COUNCIL DIRECTIVE ON THE LEGAL PROTECTION OF COMPUTER PROGRAMS

No C 91/4                              Official J o u r n a l of the E u r o p e a n C o m m u n i t i e s          12. 4. 89
                                                                     II
                                                             (Preparatory    Acts)
                                                  COMMISSION
                   Proposal for a Council Directive on the legal protection of c o m p u t e r p r o g r a m s
                                                COM(88)         816 final  — SYN         183
                                     (Submitted    by the Commission          on 5 January          1989)
                                                               (89/C 91/05)
                                                    Explanatory m e m o r a n d u m
                                                                CONTENTS
          PART O N E : GENERAL                                                                                 Page
          1. Introduction                                                                                         5
          2. The need for action                                                                                  5
               I. The nature of the intellectual property                                                         5
              II. Existing protection measures                                                                    6
             III. Harmonization of protection measures                                                            6
          3. The type of intellectual property protection retained                                                6
               I. Patents                                                                                         6
              II. Contract                                                                                        6
             III. Copyright                                                                                       7
          4. Relation to international conventions                                                                8
          5. The legal basis                                                                                      8
          PART T W O : PARTICULAR PROVISIONS
          Object of protection                                                                                    9
          Authorship of program                                                                                   9
          Beneficiaries of protection                                                                           10
          Restricted acts                                                                                       10
          Exceptions to the restricted acts                                                                     11
          Secondary infringement                                                                                12
          Term of protection                                                                                     12
 ---pagebreak---    12. 4. 89                                 Official J o u r n a l of the E u r o p e a n C o m m u n i t i e s                       No C 91/5
                                                            PART O N E : GENERAL
   1. Introduction                                                              1.4.      An adequate level of protection should therefore be
                                                                                unequivocally enshrined in the laws of all Member States and
                                                                                any difference which could affect the functioning of the
                                                                               common market should be eliminated. Common principles are
                                                                               not only necessary in order to promote the free circulation of
   1.1.   For the purposes of this proposal, the term 'computer                computer software within the Community without any
  program' is used. This means a set of instructions the purpose of            restrictions due to diverging intellectual property rules, but also
  which is to cause an information processing device, a computer,              to create conditions in which industry can take advantage of the
  to perform its functions. The program, together with the                     single market. The current absence of such clear and congruent
  supporting and preparatory design material which have made                   legislative provisions in Member States concerning the rights
  possible the creation of the program, can also be called                     of authors of computer programs has thus prompted the
  'computer software'. All such material is intended to be covered             Commission to make this proposal to the Council.
  by the provisions of this proposal in so far as it can be demon-
  strated that, from the material in question, a form of program
  has been or could be created. However, it is not thought
  advisable to include a definition in the Directive to avoid it               2. The need for action
  becoming outdated. Where the material is of a nature such that
  it could not lead to the creation of a program, for example, a
  user manual accompanying a program, although the material
                                                                               2.1.       In establishing the need for action to harmonize
  will not be protected as part of the computer program,
                                                                               computer program protection, the Commission has had regard
  protection by copyright or other means may nevertheless apply.
                                                                               for three factors: the nature of the intellectual property to be
                                                                               protected, the protection measures existing at present in
                                                                               Member States and the need to harmonize those protection
                                                                               measures throughout the Community.
  1.2.    Computer technology now plays a significant role in
 almost every aspect of the social and economic life of the
 Community, in fields as diverse as leisure, medicine, banking,
 education, transport, commerce and industry. It follows that the
                                                                              I. THE NATURE OF THE INTELLECTUAL PROPERTY
 programs which are devised to cause the computer to perform
 its functions occupy a place of growing importance alongside
 the other more traditional expressions of the human intellect,               2.2.       As far as the property right is concerned, a computer
 such as works of literature, art or music, or industrial designs             program, in common with other works protected by intellectual
 and inventions. The size and growth of the computer industry is              property legislation, is the result of a creative intellectual human
 such that it's importance in the economy of the Community                    activity. While its mode of expression or fixation may still be
 cannot be over-emphasized.                                                   unfamiliar to many, the degree of creativity, skill and inven-
                                                                              tiveness required to devise a program make it no less deserving
                                                                              of protection than other works protected by copyright. The fact
                                                                              that computer programs have a utilitarian function does not
                                                                              change this.
 1.3.    It is essential to create a legal environment which will
 afford a degree of protection against unauthorized reproduction
 to the computer program which is at least comparable to that                 2.3.       These elements of creativity, skill and inventiveness
 given to works such as books, films, music recordings or                     manifest themselves in the way in which the program is
 industrial designs, if research and investment in computer tech-             elaborated. The tasks to be performed by a computer program
 nology are to continue at a sufficient level to allow the                    need to be defined and an analysis of the possible ways to
 Community to keep pace with other industrialized countries. In               achieve these results must be carried out. A selection has to be
particular, as regards small and medium sized enterprises it is               made of the various solutions and the steps to achieve the end
 important that their ability to create and market innovative                 result must be listed. The way in which these steps are expressed
 software is not significantly reduced by unauthorized repro-                 gives the program its particular characteristics of speed, ef-
ductions of their products. Protection must therefore be streng-             ficiency and even style. A program has a structure, with sections
thened and made uniform throughout the Community as much                     and subsections, through which information flows. In common
in the interests of the specialized small and medium sized                   with other literary works, the computer program also has an
software firms which can contribute so much to the future                    underlying logic in the presentation of the various steps.
success of the European software industry as in the interests of
the existing major producers.
                                                                             2.4.        These steps, the algorithms, from which the program is
                                                                             built up, should not be protected as such against unauthorized
                                                                             reproduction. They are the equivalent of the words by which
Without such a legal environment, the intellectual effort and                the poet or the novelist creates his work of literature, or the
financial resources employed to devise computer programs are                 brush strokes of the artist or the musical scales of the composer.
put at risk by the ease with which the program can be
reproduced, imitated or counterfeited. If the level of protection
given to computer programs in Member States should fall below                2.5.       As with literary works in general, protection can only be
that accorded to programs created in other countries it is                   envisaged for a computer program from the point at which the
evident that the work of European innovators in this fast                    selection and compilation of these elements indicate the crea-
moving and highly competitive field will be easily appropriated              tivity and skill of the author, and set his work apart from that of
by predatory activities from outside the Community.                          other authors.
 ---pagebreak--- No C 91/6                                   Official J o u r n a l of the E u r o p e a n C o m m u n i t i e s                           12. 4. 89
2.6.     It is evident that the more simple and limited the                    nature territorial rights merit special attention to ensure that
functions which the program requires the computer to perform,                  they do not result in new barriers or perpetuate existing barriers
the more simple the program will be. Similarities between                      to intra-Community trade. Divergencies and uncertainty
programs are thus inevitable where the tasks are similar and the               concerning the scope of protection and the different duration of
solutions limited in number. The steps by which the computer                   exclusive rights may not only affect the free circulation of
will arrive at the completion of its task will also be similar, even           computer programs in the Community but may also influence
identical from one program to another^ where the task, the                    the decision to establish new firms or commercial initiatives and
solution and the steps required to achieve it are extremely                   thus create a distortion of competition.
simple.
                                                                              2.12.       The aim of the present proposed Community action is
Provided that copying does not take place, a program maker
                                                                              therefore to establish legal protection in those Member States
might, in theory, even produce an entire program which bears a                where it does not yet clearly exist and to ensure that the
very great similarity to existing programs, where the tasks to be             protection in all Member States is based on common principles.
performed are identical and the degree of complexity of oper-                 These principles can be summarized as follows:
ations is very low.
                                                                              — computer programs are protected as literary works by
2.7.     In practice, computer programs are rarely of such                          exclusive rights under copyright,
simplicity that authors will arrive at totally identical programs,
independently of each other. On the other hand many
sub-routines which programmers habitually use in order to build               — the person in whom the right arises is defined,
up programs are in themselves commonplace in the industry and
the originality of the program may lie in the selection and                   — the acts which require authorization of the right holder and
compilation of these otherwise commonplace elements.                                the acts which do not constitute an infringement are
                                                                                    determined,
2.8.     The success of the program in terms of its ability to
perform the task for which it is required will to a large extent be           — the term and the conditions for protection of the program
conditioned by these choices made by the author of the                              are defined.
program at every step along the way. This success will manifest
itself in a program which is quicker, easier, more reliable, more
comprehensive, more productive to use than its predecessors or                3. The type of intellectual property protection retained
its competitors.
                                                                               3.1.      Although it has been clearly established that there is a
           II. EXISTING P R O T E C T I O N MEASURES                          need for legal protection in this field and that divergences in
                                                                              legislation in Member States could bring about a situation in
                                                                              which the functioning of the internal market is adversely
2.9.     The following countries have explicitly recognized the               affected, the question has been raised as to whether copyright is
protection of computer programs by copyright: Australia,                      the most appropriate mode of protection to choose. A number
Brazil, Chile, Dominican Republic, France, Federal Republic of                of forms of legal protection exist and have been applied already
Germany, Hungary, India, Indonesia, Japan, Malaysia, Mexico,                  in practice to protect computer programs.
Philippines, Republic of Korea, Singapore, Spain, Trinidad and
Tobago, Turkey, United Kingdom, United States of America.
Draft laws are also under consideration in a number of
                                                                                                                  I. PATENTS
countries to the same effect, including Denmark, Italy and the
Netherlands.
                                                                               3.2.      As regards patent protection, this possibility seems to be
2.10.      The analysis of the existing copyright legislation in the          limited in all Member States to those programs which form part
Member States already reveals one major difference: the term of               of a patentable invention having a technical character and which
protection ranges from 25 years from creation to 70 years after               meet the normal criteria for patentability. But even for the
the death of the author. Further divergences appear if the inter-             limited group of computer programs which may satisfy most of
pretation of the law by courts is taken into account. It is true              these conditions the requirement of an inventive step will lead,
that so far courts have had only a limited number of oppor-                   in the case of a large majority of valuable computer programs,
tunities to judge cases involving the protection of computer                  to the conclusion that the conditions for patent protection are
programs, but as regards one basic condition for protection, the              not fulfilled. The inventive step may often pertain to the algor-
originality criterion, diverging interpretations exist between                ithms underlying the programs, which have normally to be
Member States, which result in a difference in the range of                   considered unpatentable, like any mathematical formulae,
computer programs which can be considered protected by                        principle or natural law. Therefore, patent protection can play a
copyright. There is similar uncertainty as to the scope of                    limited role in the legal protection of computer programs, but
protection afforded to computer programs by copyright                         does not provide an adequate solution for the basic legal
protection.                                                                   protection of such works.
  III. HARMONIZATION OF P R O T E C T I O N MEASURES                                                            II. C O N T R A C T
2.11.      Such differences in legislation can only be allowed to              3.3.      As regards contract law, this is a valuable form of
remain if they do not affect the functioning of the internal                  protection in so far as individual contractual relations exist and
market. Intellectual property rights, which are by their very                 respect of the contract clauses can be controlled. Much of the
 ---pagebreak--- 12. 4. 89                                 Official Journal of the European Communities                                    No C 91/7
software put on the market today is subject to licence              can provide the solution of ensuring adequate protection against
agreements between right holder and user. Indeed, this is the       misappropriation and, in particular, against unauthorized repro-
normal mode of commercialization for all but the most simple,       duction. Copyright has already in the past proved its capacity to
mass-produced software, such as games or standard business          adapt to new technologies, such as films and broadcasts.
packages. Such licence agreements allow right holders to            Copyright protection does not grant monopolies hindering inde-
circumscribe the activities of users in respect of all the acts     pendent development. Copyright protects only the expression
connected with the use of the program. The user is free to          but not the underlying idea of a work. It does not therefore
accept or reject the limitations on his activities which the        block technical progress or deprive persons who independently
licensing contract proposes. However, in some areas, the            developed a computer program from enjoying the benefits of
balance of power between producers and users of computer            their labour and investment.
programs may not permit the latter to negotiate equitable
contract conditions, due to the market strength of some
software suppliers. Therefore, it seems necessary to provide for
basic principles of protection which apply regardless of specific
contractual provisions. Nevertheless, individually negotiated       3.7.    Protection by copyright allows a clear balance to be
arrangements should be possible as long as they are not in          achieved between too little protection and over-protection. It
conflict with the applicable competition law.                       provides sufficient flexibility to permit a fair compromise
                                                                    between the divergent interests of producers or suppliers on one
                                                                    side and users of computer programs on the other. But the main
                                                                    advantages of this type of intellectual property protection relate
                                                                    to the fact that the protection covers only the individual
3.4.    Contract law alone does not provide efficient protection    expression of the work and gives thus sufficient flexibility to
against most forms of misappropriation. In particular, as regards   permit other authors to create similar or even identical
mass-marketed programs for personal computers and computer          programs provided that they abstain from copying. This is
games which do not need maintenance, contract law does not          particularly important because the number of algorithms
provide an adequate means to prevent the copying and use of         available, on which computer programs are based, is
computer programs by third persons. Nor is it entirely clear        considerable, but not unlimited.
whether the practice of so-called 'shrink-wrap licensing' where
use conditions are attached to a product which is, to all intents
and purposes 'sold' to the user, constitutes a valid licence in all
circumstances and in all jurisdictions.
                                                                    3.8.    Some countries have introduced 'genre specific'
                                                                    provisions in their copyright law to accommodate possible
                                                                    differences between computer programs and other more tradi-
                                                                    tional literary works. Such 'genre specific' provisions should be
                                                                    kept to a minimum if the fuil benefit of the established
3.5.    It is therefore proposed that the granting and limitation   copyright protection granted under the Berne and Universal
of exclusive rights in computer programs should reflect these       Copyright Conventions is not to be overly diluted. Accordingly,
different modes of commercial exploitation, outright sale, and      the present Directive seeks as far as possible to stay within the
licensing. Where 'sale', in the normal sense of the word occurs,    common parameters of literary work protection as it exists
certain rights to use the program must be taken to pass to the      today in the Member States of the EC.
purchaser along with the physical copy of the program. Where
licensing takes place in the conventional sense by means of a
written contract signed by both parties, the rights to use the
program which has been provided will, with a limited number of
exceptions, remain circumscribed by contractual arrangements.       3.9.    Computer program protection by means of copyright
The choice remains open for the supplier then to decide on the      raises two particular issues, that of standardization of aspects of
most appropriate form of commercialization for his product,         programs in the interests of greater inter-operability of
and for the user to manifest his preference for an outright         hardware and software, and that of availability of information
purchase or a licensing agreement.                                  concerning the access protocols and interfaces which ensure
                                                                    such inter-operability. Moves towards greater standardization of
                                                                    products within the computer and telecommunications industries
                                                                    are well under way, through the encouragement and initiatives
                                                                    of both the Commission itself and the industries concerned.
                                                                    Many aspects of computer hardware and software inter-oper-
                        III. COPYRIGHT                              ability are already governed by the International Standards
                                                                    Organization's Open Standards initiative. In addition, the
                                                                    existence of bodies such as X-Open indicates a willingness on
                                                                    the part of industry to cede proprietary rights in some parts of
                                                                    programs into the public domain in order to achieve greater
3.6.    The overwheiming weight of evidence submitted to the        compatibility between systems. The provisions of this Directive
Commission during the consultation process which followed           should contribute to the trend towards a greater use of stan-
publication of the Green Paper indicated that protection by         dardization in so far as they determine with more legal certainty
copyright is the most appropriate measure to adopt. Given the       what are the exclusive rights of the author of the program.
trend towards copyright as the best available means to ensure
the international protection of programs not only among
Member States but among the major trading partners of the
Community, it is hardly surprising that so many commentators
on the Green Paper have indicated that harmonization of             3.10.    As regards the question of the protection of 'access
copyright laws within the Community is now becoming a               protocols and interfaces' themselves, the question was raised in
priority. It is further believed that within the framework of       the Green Paper as to whether copyright protection should
copyright, protection as a literary work is desirable. Copyright    apply to these parts of programs.
 ---pagebreak---  No C 91/8                                  Official J o u r n a l of the E u r o p e a n C o m m u n i t i e s                         12. 4. 89
3.11.     In order to produce inter-operative systems it is                    5. Legal basis
necessary to replicate the ideas, rules or principles by which
 interfaces between systems are specified, but not necessarily to              5.1.      In its White Paper on the completion of the internal
 reproduce the code which implements them. Ideas, rules or                     market, the Commission stated its intention to pay particular
principles are not copyrightable subject matter. Such ideas, rules             attention to the introduction of a Community framework for
 or principles may be used by any programmer in the creation of               the legal protection of software and announced a proposal for a
 an independent implementation of them in an inter-operative                   Directive. The present proposal therefore forms part of the
program.                                                                       Commission's program for the completion of the internal
                                                                              market before 31 December 1992.
3.12.     Competitors are therefore free, once they establish                 5.2.       It follows from the approach of fixing basic common
through independent analysis which ideas, rules or principles are             principles that a Directive is the appropriate legal instrument to
being used, to create their own implementation of the ideas,                  harmonize the laws of the Member States as regards the legal
rules or principles in order to make compatible products. They                protection of computer programs.
may build on the identical idea, but may not use the same
expression as that of other protected programs. There is thus no              5.3.       Because differences in  and uncertainties regarding the
monopoly on the information itself, but only a protection of the              legal protection of computer        programs can have a negative
form of expression of that information.                                       effect on the functioning of        the common market in these
                                                                              products, Article 100A is the       appropriate legal basis for the
                                                                              present proposal.
3.13.     If similarities in the code which implements the ideas,             For the completion of the internal market before 31 December
rules or principles occur as between inter-operative programs,                 1992, Article 100A, first paragraph, second sentence, provides
due to the inevitability of certain forms of expression, where the            by way of derogation from Article 100:
constraints of the interface are such that in the circumstances no
different implementation is possible, then no copyright                       'The Council shall, acting by a qualified majority on a proposal
infringement will normally occur, because in these circum-                    from the Commission in cooperation with the European
stances it is generally said that idea and expression have merged.            Parliament and after consulting the Economic and Social
                                                                              Committee, adopt the measures for the approximation of the
                                                                              provisions laid down by law, regulation or administrative action
                                                                              in Member States which have as their object the establishment
3.14.     Although it is technically possible to decompile a                  and functioning of the internal market'.
program in order to find out information concerning access
protocols and interfaces this is a lengthy, costly and inefficient            Article 8A, second paragraph, defines the internal market as
procedure. It is usually more efficient for the parties concerned             comprising 'an area without internal frontiers in which the free
to agree on the terms under which the information will be made                movement of goods, persons, services and capital is ensured in
available. Problems of access to information may have to be                   accordance with the provisions of this Treaty.'
addressed by other means which are outside the scope of this
Directive.                                                                    5.4.       The present proposal will favour the free circulation of
                                                                              computer programs in so far as industry in those countries with
                                                                              clear and established protection of computer programs is
                                                                              currently in a more favourable position than that in countries
3.15.     In view of the rapid evolution of the computer                      where protection is uncertain; such differences in legal
industries the Commission will keep all these matters under                   protection distort the conditions of establishment and of compe-
constant review.                                                              tition in Member States for firms which engage in activities
                                                                              concerned with computer programs. This situation may affect
                                                                              the growth of the Community software industry and the
                                                                              operation of the internal market. In addition by harmonizing
                                                                              the conditions under which the results of research and devel-
4. Relation to international conventions                                      opment in the computer program field are legally protected on a
                                                                              uniform basis in the Member States, innovation and technical
                                                                              progress throughout the Community will be encouraged.
Copyright has the added advantage of affording a high level of
international protection to works so covered, through the                     5.5.       In the preparation of this proposal the Commission has
application of the Berne and Universal Copyright Conventions.                 taken into account the requirements of Article 8C of the EEC
Although neither convention expressly mentions computer                       Treaty and has concluded that no special provisions or dero-
programs among the works to be covered by copyright it is                     gations seem warranted or justified at this stage.
generally understood that as new forms of intellectual property
are developed they will be encompassed by the conventions in                  5.6.       Likewise the Commission has studied the question of the
so far as the same kinds of creativity are involved in the elabo-             high level of health/safety/environmental and consumer
ration of such new forms of work as for existing works. The                   protection required by the terms of Article 100A (3) of the EEC
conclusion that computer programs are indeed literary 'works'                 Treaty.
within the meaning of the Berne and Universal Copyright
Conventions leads to the assumption that where a Member State                 It has done so following consultation with the industrial and
grants protection under the Berne Convention it will apply the                social partners concerned, and in the light of an analysis of the
principle of national treatment. Whatever the theoretical merits              risks inherent in this area and of the current technical capa-
of 'sui generis' legislation in this field might be, they are far             bilities of European industry. The proposal takes full account of
outweighed by the advantages of the existence of these interna-               these considerations in the light of the overall objectives of this
tional conventions.                                                           provision of the Treaty.
 ---pagebreak---   12. 4. 89                                 Official J o u r n a l of the E u r o p e a n C o m m u n i t i e s                          No C 91/9
                                                PART T W O :                          PROVISIONS
                               Article 1                                       criterion which should be applied to determine the eligibility for
                                                                               protection is that of originality, that is, that the work has not
                        Object of protection                                   been copied. No other aesthetic or qualitative test should be
                                                                               applied. Sub-routines and routines which go together to form
                                                                               modules which in turn form programs may all qualify for
  1.   The words 'computer program' are not defined for the                    protection independently of the protection given to the program
 purposes of this Article. It has been recommended by experts in               as a whole, that is, as a compilation of such elements. The algo-
 the field that any definition in a directive of what constitutes a            rithms which go to make up the sub-routines are not normally
 program would of necessity become obsolete as future tech-                    in themselves capable of receiving protection under copyright in
 nology changes the nature of programs as they are known                       so far as they are similar in nature to mathematical formulae.
 today.                                                                       They may in exceptional circumstances attract patent protection.
                                                                               Similarly, the ideas, principles, or logic which underlie the
                                                                               program will not be copyrightable.
 Given the present state of the art, the word 'program' should be
 taken to encompass the expression in any form, language,
 notation or code of a set of instructions, the purpose of which is            4. (a) Many         algorithms     and     many     sub-routines   are
to cause a computer to execute a particular task or function.                            commonplace in the industry. They may have been
                                                                                         placed or have fallen into the public domain or they may
                                                                                         be de facto standard routines or algorithms. Where a
The term should be taken to encompass all forms of program,
                                                                                         program is composed wholly or in part of such
both humanly perceivable and machine readable, from which
                                                                                         commonplace or unprotected algorithms and routines, it
the program which causes the machine to perform its function
                                                                                         should nevertheless be protected as a compilation,
has been or can be created.
                                                                                         provided that it is original in the abovementioned sense
                                                                                         and that the creator demonstrated skill and labour in the
                                                                                         creation of the compilation.
Preparatory and design material such as flow charts or
descriptions of sequences of steps in plain language will be
included, as will embodiments of the program within the
hardware itself, either permanently or in removable form.                          (b) An increasingly large number of programs are now
Material such as user manuals or maintenance manuals will not                            generated by using a computer. This means that program
be considered to be parts or manifestations of the program,                              A is used in order to create programs B, C and so on
except that where substantial parts of the program are                                   with some degree of human intervention in order to
reproduced therein, those extracts from the program will be                              select the most appropriate means to achieve the
protected by copyright in the program independently from any                             objective. Program A could in this repect be likened to a
rights which may subsist in the manual or other documentation.                           literary work such as a dictionary which permits the
                                                                                         creation of other literary works. Although much of the
                                                                                         routine programming work is done by purely mechanical
                                                                                         means, human effort is still nevertheless a critical element
2.     Member States shall be required to apply the same                                 in the creative process. It is therefore proposed that in so
provisions for the protection of computer programs as apply to                           far as programs generated by such means fulfil the
literary works. A program has all the characteristics of a literary                      criteria which would enable them to be categorized as
work, namely that it is the expression in language and in a                              'original works' they should be protected in the same
perceivable form from which it can be reproduced of an idea or                           way as programs created without the aid of such
series of ideas, created by the expenditure of human skill and                           machine generation processes.
labour. The fact that the language may be only comprehensible
to those skilled in the art, and that some manifestations of the
program may take forms which are not at all times
comprehensible to the human senses does not preclude                                                            Article 2
protection as a literary work, since other literary works may
also be embodied in carriers which require a mechanical device                                           Authorship of program
to render them perceivable to the human mind.
                                                                              1.      In common with all literary works, the question of auth-
In order to avoid legal uncertainty, computer programs must be
                                                                              orship of the program is to be resolved in favour of the natural
protected as literary works and not 'as if they were literary
                                                                              person or persons who have created the work. Although the
works or 'assimilated to' literary works. Similarly they should
                                                                              right to exercise exclusive rights may be assigned to another, the
not be treated as a new and separate 'sub-category' of literary
                                                                              author will retain at least the unalienable rights to claim
work. Failure to accord the full protection given to literary
                                                                              paternity of his work.
works generally in Member States could result in divergencies in
the nature and scope of protection and in uncertainties as to the
level of protection afforded to such works under the Berne and
Universal Copyright Conventions.                                              2.      Copyright in a work created by a group of persons, which
                                                                              is normally the case with the development of computer
                                                                             programs, is to be exercised in common unless the persons
                                                                              concerned contract otherwise.
3.    Copyright protects the expression of ideas but not the
ideas themselves. Therefore the protection given to computer
programs will extend to the program as a whole, and to its
constituent parts, in so far as they represent a sufficient degree            3.      Computer programs are frequently created by freelance
of creativity to qualify as 'works' in themselves. The only                   programmers working on particular projects on behalf of organ-
 ---pagebreak---  N o C 91/10                                Official J o u r n a l of the E u r o p e a n C o m m u n i t i e s                             12. 4. 89
izations which have commissioned a given program. In such                      computer programs. Where Member States afford protection on
circumstances, unless the parties agree otherwise, it is normal                the basis of first publication of a literary work in a Member
that the person or entity which causes the work to be created                  State, that criterion should also apply to computer programs.
 should wish to retain the control over the exclusive rights in the           Thus the rules of national treatment under the Berne
program, with the exception of the right to claim paternity of                Convention will be applied to computer programs as to all other
the work mentioned in paragraph 2.1 above.                                    literary works.
4.    In circumstances where a programmer is employed to
                                                                              2.       As mentioned above, computer programs are frequently
create programs within a company or organization, the
                                                                              the creation of large teams of programmers, some of whom
employer will normally require that the exclusive rights in the
                                                                              would not be currently eligible for protection under the
program should remain within his control, with the exception of
                                                                              residence, nationality or first publication criteria outlined in
the right to claim paternity of the work, unless the parties agree
                                                                              paragraph 1 above. This anomaly can be removed by extending
otherwise. In respect of the circumstances described in this
                                                                              the application of Articles 3 and 5 of the Berne Convention to
paragraph and in paragraph 2.3 above, it is the intention of this
                                                                              all authors where a work has been created jointly, provided that
Directive that a certain measure of harmonization of current
                                                                              at least one member of the group is able to establish a right to
practice in Member States should be brought about. Never-
                                                                              protection. In this way, programmers from outside the
theless the freedom to negotiate contracts of employment and
                                                                              Community and in particular programmers from developing
terms for commissioned works must remain to a large extent a
                                                                              countries who cooperate on joint projects with programmers
subject for contractual negotiation between the parties.
                                                                              from Member States will not be unfairly disadvantaged.
In respect of other aspects of authors' moral rights such as the
right to maintain the integrity of the work, the nature of
                                                                                                                  Article 4
computer programs is such that substantial modification and
re-utilization of parts of programs is constantly taking place and
                                                                                                                Restricted acts
the concept of integrity of the work is of much less relevance to
the author's interests than has traditionally been the case with
other literary works.
                                                                              1. (a) Under traditional copyright protection for literary works
                                                                                         the author's exclusive rights comprise the right to control
5.    As indicated in 4 (b), a large number of works are now                             reproduction, adaptation and translation of his work.
generated by means of a computer program which serves as a                               The Berne Convention does not expressly give a right to
tool to generate new programs. The question arises as to                                 control the distribution of works but the exclusive rights
whether authorship of these programs generated by the first                              in respect of reproduction are in practice exercised in
computer program should reside with the creator of the first                             most countries of the Berne Union to allow the author to
program, or with the person who causes it to generate other                              determine how his work shall be put on the market.
works. Since the first program is no different in its function                           The right to control reproduction given in Article 4 (1)
from any other tool used to create a work, such as an                                    (a) is fundamental to achieve adequate protection for
instruction manual by means of which another work is created,                            computer programs. Unlike other forms of literary work,
it would seem appropriate that the person who uses such a tool                           a computer program cannot serve its purpose unless it is
to generate programs should be considered as the creator of                              'reproduced'. This 'reproduction' should not be confused
those programs. In practice, such a person may be the operator                           with 'replication'. The program may be re-created in part
of the computer, or the natural or legal persons who retain the                          or in whole as part of the internal processes of the
right to exercise the rights in programs which they have                                 computer which runs it. No second permanent copy of
commissioned or which have been created by their employees.                              the program is made during this process, although parts
In these circumstances it is doubtful that a right to claim                              of the program will be 'reproduced' and stored in other
paternity of the programs generated by a machine could be                                parts of the memory of the computer during the
upheld. The human input as regards the creation of machine                               operation of the program. These temporary copying,
generated programs may be relatively modest, and will be                                 moving and storing operations may leave no trace once
increasingly modest in future. Nevertheless, a human 'author' in                         the operation of the machine has terminated. Thus
the widest sense is always present, and must have the right to                           'copying' in the traditional sense of producing a second
claim 'authorship' of the program.                                                       permanent version of an original does not normally take
                                                                                         place unless a 'back-up' copy of the program is made.
                                                                                         Nevertheless, where programs are licensed, reproduction
                                                                                         without authorization should be prohibited, principally
                                                                                         because all the acts which could be prejudicial to the
                              Article 3
                                                                                         author's interests, namely, loading, viewing, running,
                                                                                         transmitting or storing the program cannot be performed
                    Beneficiaries of protection
                                                                                         except by means of a reproduction of the program.
                                                                                         Loading of the program is to be considered a restricted
                                                                                         act in so far as it normally at the present time necessitates
1.    Where the literary works of natural and legal persons are                          reproduction of the program in part or in whole. In
currently protected by copyright in Member States either by                              future programs may be more often contained in media
virtue of nationality or residence, in the case of natural persons,                      which can be inserted physically into the computer, such
or by having a real and effective presence in a Member State in                          as chips, or may be an integral part of the hardware. In
the case of legal persons, the same protection will apply for                            these circumstances, reproduction of the program may
 ---pagebreak--- 12. 4. 89                                   Official Journal of the European Communities                                    No C 91/11
       no longer be necessary in order to work on it. For the                 It is essential to permit right holders to control the rental
       present time, and in view of the risk of unauthorized                  of programs which have been sold or licensed if copying
       users entering and corrupting programs, it is felt that                of programs without authorization is to be prevented. It
       loading should remain under the author's exclusive                     is possible at present to rent a copy of a software
       control. Similarly, viewing, running, transmission and                 package at a nominal charge, to copy it at home using
       storage of the program all involve reproduction and are                relatively inexpensive material and to return it the
       potentially damaging to the right holder's interests.                  following day. It is clear that given the complexity of
       Computer programs are especially vulnerable not only to                most programs and the fact that they are used for a given
       copying by electronic means but also to unauthorized                   purpose rather than read for enjoyment, cheap,
       adaptation, destruction or corruption, either for financial            short-term rental allows the home copier to save on the
       gain or for political objectives. Computer programs                    cost of purchasing or leasing programs: as such, rental is
       controlling banking, military or security operations must              highly prejudicial to right holders' interests and should
       be protected against attack by 'hacking' — that is                     be subject to the right to prohibition, with the limited
       unauthorized entry into the system in order to remove,                 exceptions indicated in Article 5 below.
       add or change information contained within it. Such acts
       of fraud or sabotage can only be controlled if authors
       have wide and enforceable powers to protect programs
       against reproduction.
                                                                                                     Article 5
                                                                                        Exceptions to the restricted acts
   (b) Adaptation of a literary work normally implies transfor-
                                                                       1.   Where a program is sold to the public, it is normal that
       mation of a given text such as a novel into another
                                                                      certain rights to use the property thus acquired should apply.
       literary 'genre' such as a play. Translation of a literary
                                                                      These rights should of necessity include the right to use the
       work is normally done from one human language into
                                                                      program without further express authorization from the right
       another. In the case of computer programs, whether the
                                                                      holder. It should not be necessary to obtain the right holder's,
       act is a translation from humanly readable form into
                                                                      authorization in order to lend the program to a third party or to
       machine readable form, or from one programming
                                                                      use it on a given piece of apparatus or in a given location.
       language to another, or an adaptation of a program
                                                                      Similarly the acts of loading, viewing, running, transmission or
       designed to perform one task in order that it may
                                                                      storage should be taken as not requiring express authorization
       perform another, the term 'adaptation' best describes the
                                                                      of the right holder provided that, particularly in the case of
       activities involved. It is therefore to be understood that
                                                                      transmission and storage, they are only carried out for the
       'adaptation' in this Directive includes 'translation'.
                                                                      purposes of using the program and do not result in a second
                                                                      permanent replication of the program. Thus temporary or
                                                                      permanent transmission to and storage by a second party of a
                                                                      program legally acquired by a purchaser for his own use will
                                                                      not fall within the exceptions to the restricted acts enumerated
                                                                      in Article 4, whereas such acts of transmission and storage
                                                                      performed by the purchaser temporarily for the purposes of
                                                                      using the program himself will not require authorization by the
                                                                      right holder. Similarly any form of reproduction other than that
                                                                      required for use will not be permitted, in particular, the making
   (c) Distribution of a computer program by means of sale or         of a back-up copy or a copy for private use. Where a back-up
       licence is normally controlled by the author of the            copy is necessary for the purposes of use of a program this is
       program, either directly if he is also the producer of the     normally expressly permitted by the right holder.
       marketed product, or indirectly by assignment of his
       right to a publisher or producer of programs. The
       author's right is normally exhausted once the product has
       been put on the market with his consent. This Directive
       proposes that as regards the rental, leasing and licensing
       of software, the distribution right should not be              All reproduction should be controllable whether it is of part of
       exhausted by the first sale, leasing or licensing of the       the program or of the entire program, in that a partial repro-
       program. This will enable the right holder to exercise         duction may be sufficient to cause considerable economic harm
       control over rental of products which have been                to the author's interests, for example, by copying the protocol
       previously sold, leased or licensed and to have continued      and interface program elements of a given program.
       control over the rental, leasing or licensing of products
       which have been previously distributed by these means.
       Once a product has been sold with the right holder's
       consent he should no longer be able to exercise control
       over subsequent sale, that is sale to third parties of
       legally acquired programs. Likewise, as regards                As regards the Anglo-Saxon law concept of 'fair dealing' by
       importation for the purposes of sale, licensing, lease or      which reproduction of insubstantial parts of literary works is
       rental, once the program has been imported into the            permitted in certain circumstances, it is believed that in respect
       Community with the author's consent, his right to              of licensed programs, which constitutes the most common
       control subsequent importation will be exhausted.              method of commercialization at present, the parties are free to
 ---pagebreak---  No C 91/12                                 Official Journal of the European Communities                                         12. 4. 89
 negotiate exceptions to the author's exclusive right to control       Therefore any adaptation and translation which is done should
 insubstantial reproduction of the program if circumstances            be subject to the right holder's control in the case of licensed
warrant such a derogation. In the case of programs which are           software and should be the subject of contractual arrangements
 sold or made available by means other than a written license          between supplier and user.
 agreement signed by both parties, the provisions which exist in
 the copyright laws of Member States in relation to exceptions to
                                                                       3.    The exclusive right to control rental given in Article 4 (c)
 the exclusive rights of the author of a literary work should
                                                                       is subject to a derogation in favour of one group of users for
 continue to apply in the case of computer programs.
                                                                       whom special arrangements can and should be made. This is
                                                                       non-profit making public libraries where members of the public
 Where the current practice of 'shrink-wrap' licensing applies,
                                                                       may go to use and to study computer programs. Libraries are
 program producers impose conditions on the use of programs
                                                                       able to control the use made of such programs by means of
which have been in reality 'sold' to the consumer. The
                                                                       safeguards to prevent their duplication or their removal from
 provisions of Articles 4 and 5 are intended to have as their
                                                                       the premises. It is important, given the need to encourage
 effect that where software is licensed in the normal sense of the
                                                                       computer literacy in all sections of the Community, that
word, right holders will be able to exercise exclusive rights in
                                                                       libraries are able to offer computer programs for study by the
respect of all acts of reproduction and adaptation, the exact
                                                                       public in the same way as they offer other literary works.
provisions being the subject of contractual arrangements under
the terms of the licence. But where no written, signed licence
agreement is employed, as is the case with 'shrink-wrap' licences                                    Article 6
 (the customer being merely advised by means of instructions
contained within the packaging which surrounds the program                                   Secondary infringement
carrier of his rights in respect of his purchase) the provisions of
Article 5 (1) will allow the purchaser to assume the rights
described above. This is a necessary compromise between the            1.    In order to ensure that right holders may bring successful
interests of suppliers and consumers of computer programs.             actions against infringers of the exclusive rights given in Article
Article 4 of the Directive gives wide powers to right holders to      4, it is necessary to provide for the cases where infringing copies
control the acts of reproduction, adaptation and distribution,        have been put in circulation. The ease with which unauthorized
but these powers should not in fairness be used to circumscribe       copies of programs can be transferred electronically from one
the normal enjoyment of property by a person who legally              'host' computer to another, across national borders and without
acquires a program by purchase. If program producers wish to          trace, requires that the importation and possession of infringing
ensure the greater degree of control over the reproduction,           copies should also be actionable as should be all dealing with
adaptation and distribution of their programs which the system        infringing copies in the sense of selling, offering for sale,
of licences permits, the would-be 'purchaser' of a program            receiving, transmitting and storing such copies.
should be required to read and sign a legally binding licence
agreement at the point of sale.                                       2.     Many programs are marketed with a technical protection
                                                                      system which prevents or limits their unauthorized use or repro-
2.     Adaptation and translation of programs are acts which the      duction. If such systems are used by right holders to protect
licensee of sophisticated programs may frequently wish to do in       their exclusive rights, it should not be legally possible to remove
the course of normal use of the program. Many custom-made             or circumvent such systems without the authorization of the
computer programs have not stabilized when they are supplied          right holder. The term 'deal with' should be taken in this
to end users; similarly many programs require correction in use       context to include sale, offer or advertise for sale, transmit,
or adaptation to changes in user requirements. This correction        store or receive such means to circumvent protection systems,
and adaptation work could in many instances be done by the            and to include also the communication of information as to the
user. However the supplier has a number of reasons for wishing        means for circumvention or removal of protection systems.
to maintain his exclusive rights to control adaptation and trans-
lation. A guarantee and maintenance contract may attach to the
program which has been supplied and such guarantee and main-                                        Article 7
tenance arrangements may be invalidated or rendered expensive
                                                                                               Term of protection
and impracticable if the licensee is able to constantly amend his
licensed program. The supplier will also frequently set the
licence rate to take into account the use which can be made of        Although the term of protection for literary works is life of
the program, in terms of the number of users and the amount of        author plus 50 years, attaching the term of protection to the life
program which can be accessed. Such control is exercised by           of a human author might cause some hesitations in the light of
means of copy protection and metering systems incorporated in         joint authorship of computer generated works and the length of
the program itself. If the user were able to adapt the program,       term which will result. These hesitations outweigh the benefits
he would be at liberty to remove these control mechanisms.            of maintaining the classical 'literary work' term.
 ---pagebreak--- 12. 4. 89                             Official Journal of the European Communities                             No C 91/13
                     Proposal for a Council Directive on the legal protection of computer programs
THE COUNCIL OF THE EUROPEAN COMMUNITIES,                        Whereas for this purpose, a logical and, where appro-
                                                                priate, physical interconnection and interaction is
Having regard to the Treaty establishing the European           required to permit all elements of software and hardware
                                                                to work with other software and hardware and with
Economic Community, and in particular Article 100A
                                                                users in all the ways they are intended to function;
thereof,
                                                                whereas the principles describing any such means of
                                                                interconnection and interaction are generally known as
Having regard to the proposal from the Commission,              'an interface'; whereas the specification of interfaces
                                                                constitutes ideas and principles which underlie the
                                                                program; whereas those ideas and principles are not
In cooperation with the European Parliament,                    copyrightable subject matter;
Having regard to the opinion of the Economic and
Social Committee,                                               Whereas the Community is fully committed to the
                                                                promotion of international standardization;
Whereas computer programs are at present not clearly
protected in all Member States by existing legislation and      Whereas protection of computer programs under
such protection, where it exists, has different attributes;     copyright laws should be without prejudice to the
                                                                application in appropriate cases of other forms of
                                                                protection,
Whereas the development of computer programs requires
the investment of considerable human, technical and
financial resources while computer programs can be
copied at a fraction of the cost needed to develop them         HAS ADOPTED THIS DIRECTIVE:
independently;
                                                                                         CHAPTER I
Whereas computer programs are playing an increasingly
important role in a broad range of industries and
computer program technology can accordingly be
considered as being of fundamental importance for the                                      Article 1
Community's industrial development;
                                                                                     Object of protection
Whereas certain differences in the legal protection of
computer programs offered by the laws of the Member             1.    Member States shall protect computer programs by
States have direct and negative effects on the functioning      conferring exclusive rights in accordance with the
of the common market as regards computer programs               provisions of this Directive.
and such differences could well become greater as
Member States introduce new legislation on this subject;
                                                                2.    Exclusive rights shall be conferred by the provisions
                                                                of copyright laws. Protection shall be accorded to
Whereas existing differences having such effects need to        computer programs as literary works.
be removed and new ones prevented from arising, while
differences not adversely affecting the functioning of the
common market to a substantial degree need not be               3.    Protection in accordance with this Directive shall
removed or prevented from arising;                              apply to the expression in any form of a computer
                                                                program but shall not extend to the ideas, principles,
                                                                logic, algorithms or programming languages underlying
Whereas the Community's legal framework on the                  the program. Where the specification of interfaces
protection of computer programs can accordingly in the          constitutes ideas and principles which underlie the
first instance be limited to establishing that Member           program, those ideas and principles are not copyrightable
States should accord protection to computer programs            subject matter.
under copyright law as literary works and further in
establishing who and what should be protected, the
exclusive rights on which protected persons should be           4. (a) A computer program shall not be protected unless
able to rely in order to authorize or prohibit certain acts,           it satisfies the same conditions as regards its origi-
and for how long the protection should apply;                          nality as apply to other literary works.
Whereas the function of a computer program is to                   (b) Programs generated by means of a computer shall
communicate and work with other components of a                        be protected in so far as they satisfy the
computer system and with users;                                         conditions laid down in point (a).
 ---pagebreak--- No C 91/14                             Official Journal of the European Communities                                 12. 4. 89
                          Article 2                               (b) the adaptation of a computer program;
                  Authorship of program
                                                                 (c) the distribution of a computer program by means of
 1.   Subject to the following paragraphs, the author of a            sale, licensing, lease, rental and the importation for
computer program is the natural person or group of                    these purposes. The right to control the distribution
natural persons who has created the program.                          of a program shall be exhausted in respect of its sale
                                                                      and its importation following the first marketing of
                                                                      the program by the right holder or with his consent.
2.    In respect of computer programs created by a
group of natural persons, the exclusive rights shall be
exercised in common unless otherwise provided by
contract.                                                                                    Article 5
                                                                                Exceptions to the restricted acts
3.    Where a computer program is created under a
contract, the natural or legal person who commissioned
the program shall be entitled to exercise all rights in           1.    Where a computer program has been sold or made
respect of the program, unless otherwise provided by             available to the public other than by a written licence
contract.                                                        agreement signed by both parties, the acts enumerated in
                                                                 Article 4 (a) and (b) shall not require the authorization
4.    Where a computer program is created in the course          of the right holder, in so far as they are necessary for the
of employment, the employer shall be entitled to exercise        use of the program. Reproduction and adaptation of the
all rights in respect of the program, unless otherwise           program other than for the purposes of its use shall
provided by contract.                                            require the authorization of the right holder.
5.    In respect of programs which are generated by the
                                                                 2.    Where a computer program has been sold or made
use of a computer program, the natural or legal person
                                                                 available to the public by means other than a written
who causes the generation of subsequent programs shall
                                                                 licence agreement signed by both parties, the exclusive
be entitled to exercise all rights in respect of the
                                                                 right of the right holder to authorize rental shall not be
programs, unless otherwise provided by contract.
                                                                 exercised to prevent use of the program by the public in
                                                                 non-profit making public libraries.
                          Article 3
                Beneficiaries of protection                                                  Article 6
                                                                                     Secondary infringement
1.    Protection shall be granted to all natural or legal
persons eligible under national copyright legislation as
applied to literary works.
                                                                  1.    It shall be an infringement of the author's exclusive
                                                                 rights in the computer program to import, possess or
2.    In the case referred to in Article 2 (2) the computer      deal with an infringing copy of the program, knowing or
program shall be protected in favour of all authors if at        having reason to believe it to be an infringing copy of
least one author is a beneficiary of protection in               the work.
accordance with paragraph 1 of this Article.
                          Article 4                              2.     It shall be an infringement of the author's exclusive
                                                                 rights in the computer program to make, import, possess
                       Restricted acts                           or deal with articles intended specifically to facilitate the
                                                                 removal or circumvention of any technical means which
                                                                 may have been applied to protect a program.
Subject to the provisions of Article 5, the exclusive rights
referred to in Article 1 shall include the right to do or to
authorize:
                                                                                             Article 7
(a) the reproduction of a computer program by any
                                                                                       Term of protection
     means and in any form, in part or in whole. In so far
     as they necessitate a reproduction of the program in
     part or in whole, loading, viewing, running, trans-
     mission or storage of the computer program shall be         Protection shall be granted for 50 years from the date of
     considered restricted acts;                                 creation.
 ---pagebreak---  12. 4. 89                           Official Journal of the European Communities                          No C 91/15
                      CHAPTER II                                                     CHAPTER III
                                                                                        Article 9
                         Article 8
                                                                                    Final provisions
      Continued application of other legal provisions
                                                                1.   Member States shall bring into force the laws,
                                                               regulations or administrative provisions needed in order
 1.   The provisions of this Directive shall be without        to comply with this Directive by [date].
prejudice to any legal provisions concerning patent
rights, trade marks, unfair competition, trade secrets or      2.    Member States shall ensure that they communicate
the law of contract in so far as such provisions do not        to the Commission the texts of the provisions of national
conflict with the principles laid down in the present          law which they adopt in the field covered by this
Directive.                                                     Directive.
                                                                                       Article 10
2.    The provisions of this Directive are applicable also
in respect of works created prior to [date in Article 9].      This Directive is addressed to the Member States.
 ---pagebreak--- No C 91/16                           Official Journal of the European Communities                             12. 4. 89
           Commission conclusions decided on the occasion of the adoption of the Commission's proposal
                        for a Council Directive on the legal protection of computer programs
           In adopting a proposal for a Council Directive on the legal protection of computer programs
           the Commission approves the following policy guidelines. It affirms its conviction that
           computer programs, given the intellectual effort and the financial investment which may be
           necessary for their creation and the ease with which they can be copied, merit adequate legal
           protection. Following a worldwide trend, the Commission proposes copyright as a suitable
           legal basis for ensuring a balance between an effective level of protection and the interests of
           users. Divergencies between the copyright statutes of the Member States as to the availability
           and scope of the protection have caused the Commission to initiate the harmonization process
           in view of the objective of completing the internal market.
           Software is an industrial tool which is essential to the Community's economic development.
          The grant of exclusive rights under copyright law will create incentives for software developers
           to invest their intellectual and financial resources and thereby to promote technical progress in
           the public interest. Technical progress and public welfare, however, are also ensured by a
           system of indistorted competition, one of the principal goals of the Treaty. Exclusive
           proprietary rights and free competition, while in principle designed to achieve the same
           objective by different means, may conflict where a copyright owner is in a position to exercise
           his statutory exclusive rights beyond their intended purpose. The exercise of exclusive copy-
           rights will not prejudice the application of the competition rules and the imposition of effective
           remedies in appropriate cases. Further, the Community commitment to international standardi-
           zation in the fields of information technology and telecommunications must not be
           compromised.
          The relation between the Community's competition rules and copyright is governed by the
           European Court's distinction between the existence and the exercise of the intellectual property
           rights in question. Any arrangement or measure which goes beyond the existence of copyright
           can be subject to control under the competition rules. This means that for example any attempt
           to extend by contractual agreements or other arrangements the scope of protection to aspects
           of the programs for which protection under copyright is not available, or the prohibition of any
           act which is not reserved for the right owner may constitute an infringement of the competition
           rules.
           Moreover, companies in a dominant position must not abuse that position within the meaning
           of Article 86 of the Treaty. For example, under certain circumstances the exercise of copyright
           as to the aspects of a program, which other companies need to use in order to write compatible
           programs, could amount to such an abuse. This could also be the case if a dominant company
           tries to use its exclusive rights in one product to gain an unfair advantage in relation to one or
           more products not covered by these rights.
           Furthermore, the ability of a competing manufacturer to write an independent but compatible
           program often depends on his possibility to have access to the target program or to certain
           information relating to it. Access to information is not a matter of copyright law. Article 86
           always applies where a dominant company abusively refuses access to such information or
           restricts unreasonably such access.