The Legal Framework of Software Licensing
The distribution and use of software remain within the sphere of copyright: the author of a computer program enjoys, together with the general rights, the exclusive right to effect, permit or prohibit the reproduction of the program by any means and in any form, in whole or in part. Where such reproduction requires the loading, display, running, transmission or storage of the program, the author's consent is necessary. The author also holds the right of translation of the program from one programming language into another, adaptation, rearrangement and other modification. The same logic extends to databases: their author controls temporary or permanent reproduction, translation, adaptation and the distribution of the results. Licensing is used precisely for granting these rights, and the correctness of the licence agreement determines the lawfulness of the use — an activity that seems technical at first glance but rests entirely on the accuracy of the contractual text.
Limitations of the Rights of the Owner
The law also protects the lawful owner: a person who lawfully possesses a copy of a program or a database is entitled, without the author's consent and without paying a royalty, to make the changes necessary for the functioning of that person's technical means, to perform actions connected with functioning — including the recording and storing in the computer's memory for one computer or for one user of a network — and to correct obvious errors. The making of a backup copy is likewise permitted where it is intended solely for the archive and for replacing a lost or destroyed or unusable copy. The backup copy may not be used for a different purpose and must be destroyed as soon as the right of possession ceases. These limitations must be precisely reflected in the conditions of the licence so that neither party's expectations diverge from the statutory frame.
Essential Conditions of the Licence Agreement
A licence agreement must provide for the precise description of the work to be used — the title, the volume, the genre — the specific type of use of the work, the term and territory of the agreement's operation, the method of determining the royalty or the amount of the royalty for each type of use, the manner and time of its payment, as well as other conditions the parties regard as essential. The types of use not directly provided for in the agreement remain with the author. The form also matters: an agreement on the transfer of copyright, on the creation of a work and a licence agreement must be concluded in writing. Violating these requirements deprives the transaction of its foundation and creates the risk of a dispute in which the unagreed uses will be treated as belonging to the author by default.
Gaps in the Agreement and the Rules of Interpretation
The law fills the signs the parties have left undefined: where the specific type of use is not provided for, the agreement is considered concluded for such use as may be deemed necessary for the fulfilment of the parties' intent existing at the conclusion of the agreement. Where the term is undefined, the author or other holder may annul the agreement after three years from its conclusion, notifying the licensee in writing six months before the annulment. Where the territory is undefined, the agreement operates only on the territory of Georgia. The transfer of the granted rights to other persons is possible only where directly provided for in the agreement; and where the royalty is fixed as a lump sum, the agreement must state the maximum print run of the work. These gap-filling rules are decisive for planning the licence: silence of the contract is not neutrality but the application of statutory defaults that may not match the commercial intention of either party.
Frequently Asked Questions About Software Licensing
What rights are transferred by a licence?
Only those directly provided for in the agreement: all other types of use remain with the author or other holder. The list of permitted uses must therefore be formulated precisely.
May a backup copy be made?
Yes, for a lawful owner this is permitted where the copy is intended solely for the archive and for replacing a lost or unusable copy; it must be destroyed as soon as possession ceases.
What happens when the term is undefined?
The agreement may be annulled after three years, with prior written notice — six months before annulment. With no territory defined, the operation extends only to Georgia.
In what form is a licence agreement concluded?
In writing, like an agreement on the transfer of copyright and on the creation of a work; any other formalization increases the risk of a dispute.
How We Help on Legal.ge
The lawyers of Legal.ge assist in drafting and verifying licence agreements: we describe the types of use, define the terms and territory, fix the royalty model and defend your position in a dispute. Contact us — a licence is a document where precise wording creates value.