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Intellectual Property Rights for the Created IT-product: Problem Points


Mariia Koval, Attorney at Ilyashev & Partners Law Firm
Source: Jurist&Zakon

The rapid development of IT-sphere requires attention to adequate protection of intellectual property rights for IT-products. The issue of comprehensive protection of computer programs, software and similar products remains open to a large extent.

The first problem: lack of appropriate comprehensive protection of software

Finished software is protected under the Law of Ukraine “On Copyright and Related Rights” as a literary work. Thereto, technological data processing, the algorithm that is often an important product of intellectual activity, can not be protected in any way. This is the practice not only in Ukraine, but almost worldwide.

According to Article 4 of the Copyright Treaty (1996) of the World Intellectual Property Organization, computer programs are protected as literary works within the meaning of Article 2 of the Berne Convention for the Protection of Literary and Artistic Works. Such protection applies to computer programs regardless of the manner or form of expression.

It is necessary to take into account industrial approach to software development that requires a clear and comprehensive protection of such products.

It is clear that the approach to protection of software as literary works is itself illogical and inconsistent with the very essence of such products. After all only embodiment of software in material form is protected, and the content of the product is not subject to protection.

That is the idea, process or method underlying the product is not subject to protection. Surely, external design of such product may be changed and a new product may be obtained, “without prejudice” to the copyright of the creator of the original product.

At the same time long-term protection of copyright regarding information technology products is not appropriate as in a year or two this product may be not only irrelevant, but also obsolete.

To protect the idea and not just the form of expressions, IT-products can be also protected as inventions or utility models. However, it is quite a long and costly process that is more appropriate for large IT-companies, and not for individuals and small legal entities. Especially in case of patenting IT-products it is often very important to fulfill the condition of “industrial applicability”, because in this case the product should not be just a theoretical development, but a technical solution of any problem.

However, in some countries, such as the Russian Federation, registration of software as inventions is impossible.

According to Art. 180(2) of the Association Agreement between Ukraine, on one hand, and the European Union, the European Atomic Energy Community and their Member States, on the other hand, protection is provided to the mathematical expression of a computer program of any form. The ideas and principles that underlie any element of a computer program, including those underlying its interface, are not protected by copyright under the above Agreement.


Thus, analyzing the existing legal approach, we can conclude that it is impossible to ensure proper comprehensive protection of authorship to algorithms and their implementation, which in turn, does not facilitate development of the IT sector.

The second problem: proper registration of rights

Obviously, property rights for IT-products are very rarely owned by the authors, because the computer programs are written by programmers, and the property rights are owned by employers or third parties (clients).

Use of property rights for software, namely, public performance, reproduction, processing, distribution, lease, etc. always require entering into copyright agreements.

Even entering into such an agreement, the parties often forget to indicate an exhaustive list of transferred property rights, which leads to serious problems in the further use of software. It should be remembered that property rights not mentioned in the author’s contract as alienated are considered as not transferred.

It is also important to document the transfer of property rights to the product in the relations “employee (author) – employer”.

According to Art. 16(2) of the Law of Ukraine “On Copyright and Related Rights”, exclusive proprietary right to official work belongs to the employer, unless otherwise provided by a labor agreement (contract) and (or) civil law contract between the author and the employer.

Today employers do not pay enough attention to the correct registration of property rights to software products, considering that all works created are de facto owned by the employer. It creates a lot of problems in the future use of the products and leads to numerous lawsuits.

According to Art. 35(1) of Resolution of the Plenum of the Higher Commercial Court of Ukraine “On some issues of dispute resolution relating to the protection of intellectual property rights” of 17.10.2012, No. 12, if the product and/or object of related rights is created (made, produced) by the official assignment of the employer and on the account of the latter, or during performance of official duties under the employment agreement (contract) or by order, the exclusive property rights to the object of intellectual property belong to the parties to such agreement together unless otherwise provided by the agreement; while personal non-proprietary rights are not alienated and belong to authors and performers – individuals.

The rights to works and/or objects of related rights created outside the official employment contract or assignment, order, can not be considered transferred to the employer by law. For example, illustrations to the work made by the employee during performance of assignment will not be considered as official works, if not provided in the assignment or a labor agreement (contract) with the employer.

The framework of the official assignment in case of a dispute as determined by the content of the labor agreement (contract) and other documents determining the scope of official duties of the employee (job descriptions, orders, instructions, memos, etc.).

Thus, the employers should remember that it is important to register with the employees the necessary documents for the ownership of all property rights to software products.

It should be noted that the Association Agreement between Ukraine, on one hand, and the European Union, the European Atomic Energy Community and their Member States, on the other hand, requires Ukraine to change regulation of relations regarding official works, namely, establishes provision that if a computer program is created by an employee to perform his job duties or according to the instructions of the employer, the employer owns all exclusive property rights to the created computer program, unless otherwise provided by the contract.

Problem three: protection of rights

According to the Law of Ukraine “On Copyright and Related Rights” piracy in copyright means publication, reproduction, import into the customs territory of Ukraine, export from the customs territory of Ukraine and distribution of counterfeit copies of works (including computer programs and databases).

It is no secret that today in Ukraine there is a huge problem of copyright protection for software products. Note that in 2016 Ukraine took the first place in the ranking of states that most often violate intellectual property rights. As reported by Microsoft Corporation, in 2015 almost 85% of products manufactured by it and used in the Ukrainian public institutions were unlicensed.

Obviously, every author or copyright holder wants to protect his copyright of violations. However, it is not so easy to do this in Ukrainian reality, because the mechanisms of protection and fight against piracy in Ukraine are very imperfect.

Besides selling and replication of counterfeit copies of software products, today the most popular is software distribution via the Internet that creates serious difficulties for stopping violations of copyright. After all now it is almost impossible to identify a violator of copyright on the Internet, who is often an individual.

According to para. 11, clause 46 of Resolution of the Plenum of the Higher Commercial Court of Ukraine No. 12 “On some aspects of resolution of disputes related to protection of intellectual property rights”, it should be also remembered that public access to confidential data about the individuals, contained in the records of identifier of domain holders is closed. Therefore, if access to such data is required, the plaintiff may lodge a motion for their reclamation to the commercial court.

Thus, the only way to establish the identity of the offender and/or the owner of the website where the counterfeit product is placed is to go to court (after paying the court fee), which, of course, not every copyright holder wants and is able to do.


Although the problem of protecting software products in Ukraine has been recently very actively discussed, unfortunately, no improvements in this area are observed. All progressive draft laws on this issue remain on the shelves of the Verkhovna Rada of Ukraine.

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