The problem is based on the provisions of the law, according to which the rights to software and other works created by order belong to the customer, unless otherwise provided by the contract between the contractor (performer) and the customer (Art. 1296 of the Civil Code of the Russian Federation).
In this regard, many developers are afraid that the requirement of the law to transfer exclusive rights to code created on the basis of previous developments will deprive them of their rights to previous versions of the software. And sometimes developers are not at all ready to transfer the exclusive right, since the customer can become a direct competitor.
With this in mind, in practice, several methods have been developed for contractually protecting the developer’s copyright on their own software and the results of its subsequent modifications. We will tell about them under the cut.
The simplest and most common option is based on the fact that for each new result of creative activity an exclusive right arises as an independent object. Therefore, the contract for the development of software clearly defines the conditions that the contractor retains the exclusive right to the original product that has undergone processing as part of the contract with the customer. In this case, the customer receives the exclusive right to a derivative product created as a result of modification of the original.
A more sophisticated version of copyright protection involves the conclusion of a license agreement on the original product with the possibility of modification, and then the work on the processing of the original software product as part of the order. This approach requires the conclusion of two contracts, and therefore in practice it is more difficult to apply.
Sometimes developers, in order to justify the option with a license for the original product and, of course, protect the rights to it, create a separate company for which all products are registered.
Another option for copyright protection is the issuance of a free license for the results of work under a software development agreement, which is expressly allowed by the provisions of Article 1296 of the Civil Code of the Russian Federation. In this case, the exclusive right to a new and original product is retained in full by the developer.
And the most radical way to protect copyright not only in the original, but also in the derivative software product, has recently been the conclusion of a license agreement on the provision of the right to use the software, which will be created in the future. In such a situation, the provisions of Article 1296 of the Civil Code of the Russian Federation do not apply in principle, since the contract for custom development is replaced by a license.
For a long time there was no consensus on the possibility of concluding a license agreement for a non-existent software product, since the licensing object should be clearly described in the license agreement. However, the Supreme Court recently put an end to this dispute.
According to the clarifications of the Plenum of the Armed Forces of the Russian Federation, the above provisions do not exclude the possibility of concluding a license agreement providing for the right to use the result of intellectual activity that will be created in the future. The exclusive right to use the result of intellectual activity is granted at the moment specified in the contract, but not earlier than the moment of the occurrence of such a right. At the same time, the subject of such an agreement should be individualized in such a way as to enable it to determine the specific result of intellectual activity with respect to the right to which the agreement is concluded at the time of granting the right to use such an object in accordance with this agreement ( paragraph 47 of the Resolution of the Plenum of the RF Armed Forces of April 23. 2019 N 10 ).
Thus, if there is a choice, the developer can replace the usual contract for the creation of software with a new license agreement for the provision of the right to use software that will be created in the future.
It must be understood that the contractual structures under consideration differ significantly in the scope of the rights and obligations of the parties.
The software development agreement not only provides for the occurrence by default of the exclusive right to work results for the customer, but also allows him to control the progress of work, ask the contractor for their quality and terminate the contract ahead of schedule.
The license agreement a priori retains the exclusive right of the developer, deprives the client of the legal ability to control the development, allows the transfer of a new product on an “as is” basis, and does not provide for the possibility of early termination. Plus, the implementation under a software license agreement is exempt from VAT for developers on the OSNO.
At the same time, the license agreement has a number of inconveniences for the developer as well, since in the event that the parties stipulated in it the possibility of early termination unilaterally, the customer has no obligation to pay for work performed before the termination, and additional compensation for losses.
Choose software development contracts wisely!
More about developer rights