Consumer licences under Georgian copyright law
An end-user licence — the document a consumer accepts when installing a program, a game or digital content — falls in Georgia within the licence-contract frame of the Law on Copyright and Neighboring Rights: the use of a work, as a rule, requires the consent of the author or rights holder and a royalty, and the licence is precisely the form of that consent. On this page we explain which types of licence exist, what the contract must contain and in what form it is concluded.
Exclusive and simple licences
The law distinguishes two types. Under an exclusive licence contract, the author or other rights holder gives only the licensee the exclusive right to use the work in the manner and within the limits defined by the contract, and empowers the licensee to prohibit such use by others, including the author. Under a simple licence contract, the licensee is granted the right to use the work on a par with those persons who have received the right of use in the same manner. The simple, non-exclusive licence is the usual shape of the standard licence distributed to consumers: each consumer receives the same right on the same terms. Whether the right is exclusive or simple affects the market for the use, and the choice is therefore part of the business model.
The default rule: a transferred right is simple
The default rule of the law matters: a right transferred under a copyright contract is deemed a simple right unless the contract provides otherwise. If the document does not expressly state that the right is exclusive, it is assessed as simple — and accordingly the author may grant the same right to others as well. A later attempt to present the licence as exclusive will fail on the strength of the text alone where the wording is ambiguous.
What the licence must contain
A licence contract must include the elements established by law: the exact description of the work — title, volume, genre; the specific type of use; the term and territory of effect; the amount of the royalty or the method of its determination for every type of use, the procedure and term of payment; and other terms the parties regard as material. The law answers omissions with gap-filling rules: every type of use not directly provided for belongs to the author or other rights holder; where the specific type of use is absent, the contract is deemed concluded for such use as is necessary to fulfil the intention of the parties; where the term is absent, the author may terminate the contract after 3 years, notifying the licensee in writing 6 months in advance; where the territory is absent, the contract operates only in Georgia; rights may be passed on to others only where directly provided; and where the royalty is a fixed sum, a maximum print run must be set.
Form: written, and one exception
Contracts on the transfer of copyright, on the creation of a work and licence contracts must be concluded in writing. The exception concerns only licence contracts for the use of a work in periodical print publications, which may be concluded orally. In digital distribution the written form is normally satisfied by an electronic document — the consumer's acceptance of the terms is recorded, creating evidence of the contract's existence.
Where the boundary of the licence lies: free use
A licence governs use that does not fall within the free cases allowed by law. The law permits use without consent and royalty only in a closed list, with mandatory indication of the author and the source — including quotation for scientific, research, polemical, critical and informational purposes to a justified extent; the use of short excerpts by way of illustration; reviews of current events; the reproduction of publicly delivered reports for informational purposes; and the reproduction of works created for the blind without profit. Any use outside this frame requires a licence — and the terms of a licence cannot restrict statutory free use.
How we can help
We draft consumer licences that satisfy the law and protect your business model at the same time: we define the types of use, the term, the territory and the royalty rules, weigh the need for exclusivity, and prepare the document in accordance with the written-form requirement. Contact us — we will assess your situation.
In the digital market a consumer licence often combines three functions: it regulates the right of use, defines restrictions and at the same time protects the holder from uncontrolled distribution. All three remain within the frame set by law: the types of use must be defined exactly, since unlisted types remain with the holder; restrictions cannot touch lawful free use; and protection rests on the terms of the contract and the mechanisms that follow its breach. A well-drafted licence is therefore not the one containing many restrictions, but the one whose terms are precise and defensible in a dispute. Overly broad or ambiguous clauses work in court precisely against the party that tried to write them.
The royalty question deserves separate mention in consumer licences: the law requires the amount of the royalty, or the method of its determination, to be fixed for every type of use. Where the use is paid, this is direct settlement; where content is distributed free of charge under another model — advertising or additional services, for example — the royalty rule must still be reflected in the document. In addition, where the royalty is fixed the law requires a maximum print run to be set — in digital distribution this means defining a quantitative limit of copies or resolving it appropriately for the particular use.