0370 270 6000

already registered?

Please sign in with your existing account details.

need to register?

Register to access exclusive content, sign up to receive our updates and personalise your experience on brownejacobson.com.

Privacy statement - Terms and conditions

Forgotten your password?

When a software "licence" becomes a "sale" - a new market for secondhand software

1 August 2012

Call me a pedant if you will but when someone says they’re “buying” a software licence, its always sounded wrong to me – if only because of the distinction between “buying” and “licensing”.

Yet as far as the ECJ is concerned  a perpetual licence of software should be treated as equivalent to a “sale” for the purposes of legislation concerning the exhaustion of rights – meaning that a licensor may not prevent a licensee from licensing to others in the EU and clauses in licences that seek to prevent assignment or sublicensing will not be effective, provided the licensee gives up its own rights.

This decision potentially creates a new market for “secondhand” software and, I suspect, will challenge “authorised” resellers – particularly if others join Usedsoft in supplying discounted licences of existing software. It may also accelerate the move towards cloud computing, as providers move towards a subscription, rather than a traditional licensing model, to prevent the onwards distribution of licences.

Related opinions

Flexible working, childcare and indirect sex discrimination – important reminder

The courts have long recognised that, on a societal level, women bear a greater burden of childcare responsibilities than men which can make it more difficult for women to comply with employer requirements for flexible working (known as the ‘childcare disparity’).

View blog

Supreme Court awards compensation to a Professor for an invention created during his employment

A recent decision by the Supreme Court in Shanks v Unilever PLC has supported the right for employees to receive compensation for patented inventions if the invention is of ‘outstanding benefit’.

View blog

Cyber risks – are businesses really ready?

The Hiscox Cyber Readiness report, a review of 3300 organisations, will be a stark warning for CEO’s of SME’s in the UK and in Europe.

View blog

Artificial intelligence in legal and contracting

With its claims to disrupt and transform many areas of our lives, AI is now part of our day to day vocabulary.

View blog

Richard Nicholas

Richard Nicholas

Partner and Responsible for In House Lawyers

View profile

Mailing list sign up

Select which mailings you would like to receive from us.

Sign up