WHAT ONE NEEDS TO KNOW WHEN IT COMES TO COPYRIGHT PROTECTION OF SOFTWARE IN THE LEGAL SYSTEM OF THE REPUBLIC OF SERBIA

The different legal systems (EU/USA/Japan and other countries) offer different forms of software legal protection, which could lead to conflict of laws between different countries. Despite the lack of unique legal protection, all jurisdictions agree that copyright protects the form of expression (which in the case of computer programs represents object and source code with pertaining documentation), but does not protect the idea which represents its actual value.

Furthermore, a developer may create a program with an identical function as their competitor’s (software clones), without infringing copyright, because copyright does not protect interface specifications as underlying principles on which a computer’s operation relies. The question is how to protect interface specifications?

Customers and developers are not usually fully aware what transfer of copyright turnover implies. Copyright, as a part of intellectual property rights, is different from the concept of ownership property and implies a corpus of moral rights (which are non-transferable) and proprietary rights (which could be assigned or transferred).

In practice, the most common problems (due to non-transferability of moral rights) occur during transfer of proprietary rights through (i) development agreements (commission of software development), as a most common way of disposal, and/or (ii) an employment agreement. Namely, according to the Serbian Copyright Act, moral rights remains with the developer, as opposed to the U.S. Copyright Act ,17 where the customer may be considered as the owner of the software if the deal fits one of the copyright law’s nine categories i.e. work-for-hire-provision institute.

Therefore, the customers from USA, who order software through development agreements and other professional service relationships in Serbia, are wrongly deemed to have acquired ownership of software property and can transfer copyright further on, without limitation, regardless of the non-transferability of the personal right under the governing Law. Therefore, it is highly advisable that, during conclusion of the development agreements, the parties specifically pay attention to the governing law and jurisdiction of the competent courts.

From a legal point of view, transfer of software copyright is a highly complex matter, thus it is important to properly regulate all relations arising from the software development in order to avoid any future problems which could materially affect all participants. For example, there are various current disputable matters in practice:

• What are the legal consequences of the unilateral termination of the license agreements/development agreements, when the proprietary rights are further assigned and/or transferred exclusively to third parties?
• How to distribute profit between co-authors/co-workers, if they failed to regulate their mutual relations (contributions of each co-authors) by written agreement?
• How to assign/transfer proprietary right authorizations to third parties, in the case of disagreement between certain co-authors/co-workers?

During execution of development agreements, the customer should check whether all proprietary rights are properly transferred from the author, a natural person, to the service provider who is usually a legal entity, as the latter cannot transfer to the customer more rights than those transferred to him by the employee/author.

Problems with software created during employment may manifest in multiple ways: (i) How to prove if the employee actually developed the software during employment? (ii)  How to prevent an ex-employee developed a similar software with the new employer?

In conclusion–bearing in mind the aforementioned deficiencies of software copyright protection, it is necessary that co-authors/co-workers of software development, software customers, and potential third parties as assignees, legally regulate their contractual relations in an adequate way in order to hopefully eliminate risks which could occur in the future.

 

Attorney at law, Lidija Labudović,

Master of Intellectual Property and Informational Technologies

Harrisons

Member of the Supervisory Board, SAM