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Legal alert: decompiling licensed software allowed to correct errors

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On 6 October 2021 the Court of Justice of the European Union (“CJEU”) clarified that in case of an error in a software that affects its proper function, a lawful purchaser (e.g. licensee) can legitimately decompile all or part of that software, to correct such error, including disabling a certain function. In such event the lawful purchaser does not have to adhere to the conditions set out in article XI.300 Belgian Code of Economic Law regarding interoperability.

1)      What was the dispute about?

The underlying dispute arose between Selor, part of the Belgian government, as licensee, and Top System, a software provider, as licensor. The IT solution licensed by Top Systems to Selor concerned an online application platform for candidates. In this context, Top System also developed customised software (functionalities) for the Belgian government. As Selor was confronted with continuous operational issues during several months, it took matters in its own hands and decompiled the licensed software to correct the error (by disabling a function).

2)      What copyright protection is applicable to software?

The protection of software programs is governed by Directive 91/250[1] (also referred to as the “Software Directive”) that has been implemented in Belgian, i.e. now articles XI.294-XI.304 Belgian Code of Economic Law (“BCEL”). These provisions provide specific copyright protection to software programs as lex specialis. Elements that interact with software or are coded in a programming language, that do not themselves constitute a software program (e.g. graphic user interface[2]) are excluded from such specific copyright protection. They could nevertheless still enjoy regular copyright protection pursuant to articles XI.164 et seq. BCEL if they adhere to the conditions thereto (i.e. they qualify as a work and meet the threshold of originality).

In accordance with the lex specialis on software programs the exclusive rights of the right holder include the right to do or to authorise (article XI.298 BCEL):

(a)      the permanent or temporary reproduction of a software program by any means and in any form, in part or in whole;

(b)      the translation, adaptation, arrangement and any other alteration of a computer program and the reproduction of the results thereof;

(c)      any form of distribution to the public, including the rental, of the original computer program or of copies thereof.

As an exception to these rights, article XI.299 BCEL stipulates that a lawful purchaser (lawful licensee) does not require prior consent:

  • for the acts in article XI.298 (a) and (b) BCEL (i.e. reproduction, translation, adaptation, etc.) where such acts are necessary for the use of the computer program by the lawful acquirer in accordance with its intended purpose, including for error correction;
  • to make a back-up in so far it is necessary for the use of the software program;
  • to observe, study or test the functioning of the software program in order to determine the ideas and principles which underlie such software program during the loading, displaying, running, transmitting or storing the program.

 

Further a “interoperability provision” is foreseen in article XI. 300 BCEL, also providing for exceptions to the exclusive rights in case the copyright protected software needs to be linked to another program or system, i.e. to achieve the interoperability of an independently created computer program with other programs (provided that certain conditions are met).

The act of “decompiling” is intended to reconstruct the (understandable) source code of a program from its object code (it consists in a transformation of the program in (protected) object code form into ‘quasi-source code’). It can be seen as some sort of “reverse engineering”, that is to say a process by which the finished product is used as the starting point for discovering how a complex tool is constructed, as applied to computer programs.

This was thus already allowed to obtain interoperability. In this judgment the CJEU ruled that this is also allowed to correct errors that affect the proper function of the software program (under certain conditions).

3)      What did the CJEU decide?

In the case at hand, Top System was of the opinion that Selor had breached the (predecessors in the old act of) articles XI.298 and XI.300 BCEL, as it had decompiled the software, copied the source code and disabled a certain function of the software program, without Top System’s prior consent and without the above mentioned exception of “interoperability” to apply.

Selor admitted that it had done so but argued that there was no violation of Top System’s exclusive rights under article XI.298 BCEL as it was necessary to address errors in the software (that Top System apparently refused to correct or was unable to do so, in Selor’s views).

The CJEU started with the question whether decompilation falls within the right holder’s exclusive rights. The object and source code of a software program are subject to (the specific) copyright protection under articles XI. 294-XI.304 BCEL. Decompilation consists in a transformation of the program in (protected) object code form into ‘quasi-source code’. The latter is a reproduction of the program resulting from its alteration; that alteration consists in the translation of the machine language into a programming language. As the code is hence reproduced and translated to another form, the CJEU found that such actions fall under the exclusive rights of the right holder (article XI.298 BCEL).

The second question was to what extent Selor could invoke the exception under article XI. 299,§1 BCEL (art. 5(1) Software Directive): i.e. to reproduce and/or translate the code without the prior consent “for the use of the computer program in accordance with its intended purpose, including for error correction.”.

Top System did not agree and argued that solely based on article XI.300 BCEL on “interoperability” (art. 6 Software Directive), one is entitled to deviate from the right holder’s exclusive rights of reproduction and translation.

The CJEU did not share Top System’s view: article 6 and recitals 19 and 20 in the Software Directive do not exclude the possibility for a lawful purchaser to reproduce the code or translate the form thereof without the right holder’s prior consent, based on another legal ground in the Software Directive. The scope of articles 5 and 6 Software Directive is deemed different because they cover different situations. Article 5(1) concerns the acts necessary for the use of the computer program, including for error correction, whereas article 6 concerns the acts necessary to ensure the interoperability of independently created programs.

The CJEU consequently agreed with Selor and ruled that a lawful purchaser of a computer program is entitled to decompile all or part of a licensed software program based on article 5(1) Software Directive (art. XI.299,§1 BCEL), under the following conditions:

a)       it is necessary to correct errors that prevent the lawful purchaser from using the program in accordance with its intended purpose;

  • an “error” commonly designates a defect affecting a computer program which is the cause of the malfunctioning of that program; in this regard such defect must affect the use of the program concerned in accordance with its intended purposes; and
  • where the source code is lawfully or contractually available to the lawful purchaser, decompilation shall not be deemed “necessary”;

b)      where applicable, subject to the specific contractual provisions agreed upon between parties;

  • article 5(1) must be understood as meaning that the parties cannot prohibit any possibility of correcting errors by contractual means, they remain however free to organise contractually the way that option is to be exercised;

c)       the lawful purchaser cannot use the result of any decompilation for purposes other than the correction of the identified errors that hinder the software’s operation (e.g. no further distribution of the copied (quasi) source code is allowed).

 

4)      Relevance in practice?

This decision is relevant in practice for companies that are confronted with deficient software programs whereby the provider is unwilling (or unable) to correct errors in the licensed software. The company can in such event take matters in its own hands. Indeed, where no access is available to the source code (e.g. based on the license agreement or a tripartite escrow agreement), the company is allowed to decompile the licensed software to correct the errors affecting its operation.

Nevertheless, we recommend being precautious and to build up a strong file (e.g. by sending several formal notices to the defaulting third-party software provider) prior to jumping to this “remedy” of decompilation. Parties are under an obligation based on article 1134 Civil Code to perform their contracts in good faith. As it is the software provider that is in principle responsible to correct any errors that affect the proper function, we advise a remedy period to allow the software provider to perform its contractual obligations. It speaks for itself that the “remedy” of decompilation (as a last resort) can of course be used as leverage in such formal notice to incite the provider to undertake (further) corrective measures.

On the other side, as a software provider, it is recommended to include contractual language in this regard in the customer contracts. Although the possibility of decompilation to correct errors that affect the proper operation of the software cannot be excluded, parties can contractually determine the modalities, e.g. obligation to first send (several) formal notice(s), after how many unanswered formal notices can the client take recourse to this “remedy”, at whose expenses, etc. Another option would be to contractually make the source code available in certain circumstances, possibly using an escrow. In such event, article XI. 299, §1 BCEL, allowing the decompilation, will not come into play given the conditions set out by the CJEU in this judgment.

 

The judgment can be consulted here: https://eur-lex.europa.eu/legal-content/EN/TXT/HTML/?uri=CELEX:62020CJ0013&from=en

 

If you have questions in this regard, feel free to contact Dorien Taeymans (d.taeymans@liedekerke.com) or anyone else of our IP/IT team.



[1] Council Directive 91/250/EEC of 14 May 1991 on the legal protection of computer programs.

[2] See CJEU 22 December 2010, C-393/09, Bezpečnostní softwarová asociace – Svaz softwarové ochrany v. Ministerstvo kultury, §28-42.