By Emmanuel K. GADASU
In the world of software development, the question of who owns the source code is a significant and sometimes contentious issue.
This controversy touches on various aspects of intellectual property law, employment agreements, and the rights of developers and businesses.
Understanding the complexities of source code ownership is essential for both developers and organizations to protect their interests and avoid legal disputes
Source code is a critical element in software development, enabling the creation, maintenance, and enhancement of software applications across various platforms and industries.
Every software program, web application, mobile app, website, etc has a lifeblood: its source code. This code, like any creative work, is protected by copyright, which essentially grants ownership to its creator. These creators can be individuals (like developers) or legal entities (companies, organizations, etc.).
What is a source code?
Source code is the original version of software written by developers in a specific programming language. It contains instructions that are later translated into machine language and often includes comments to aid in its understanding. Source code is usually stored in a repository.
Source code refers to textual commands that a developer or programmer writes, which a computer then translates and runs as a program. Source code is essentially the set of instructions, written in a human-readable programming language, that tells a computer what to do. It’s like a detailed recipe that the computer follows to perform a specific task or function within a software program, mobile application, or website.
Source Code and Copyright
In the context of source code, copyright is a legal right that grants the author or creator exclusive control over the use, reproduction, distribution, and modification of their original work. The following copyright issues applies to source code:
Ownership: The author of the source code, typically the developer or the entity that commissioned the work (depending on the contract), holds the copyright. This means they have the exclusive right to control how the source code is used and distributed.
Rights Granted: The copyright holder has the exclusive rights to:
– Reproduce the source code (make copies).
– Distribute copies of the source code.
– Create derivative works based on the source code (e.g., modifications or adaptations).
– Publicly display or use the source code.
Infringement Claims: Unauthorized use, reproduction, or distribution of copyrighted source code can constitute copyright infringement, which can lead to legal consequences, including injunctions and damages.
Licensing: The copyright holder can license their source code to others, allowing them to use, modify, or distribute it under specified conditions. Licenses can range from very permissive (e.g., open-source licenses) to very restrictive.
Understanding copyright in the context of source code is crucial for both developers and organizations to ensure that their intellectual property rights are properly managed and protected.
Copyright protection goes beyond just the source code. It also covers the software’s architecture, documentation, interface, and even early drafts and test versions. In simpler terms, the software is copyrighted from the very beginning of its development.
However, for copyright to apply, the software and its code need to be original. This means they must be the result of a unique intellectual effort by the developer or the company behind it, demonstrating creative choices made during the development process.
Freelancers generally own the copyright to their software by default. However, for employees at a company, the copyright typically gets automatically assigned to their employer. If an employee wants to retain ownership, a specific agreement needs to be established with the company beforehand.
Copyright and Software Development
Copyright is an intellectual property right that automatically protects an original work as soon as it is created. This protection applies to various types of works, including artistic works, literary works, sound recordings, dramatic works, films, musical works, communication works, and typographical arrangements of published editions.
When it comes to source code, it is considered a literary work (this is clearly stipulated in the Article 10(1) of the Trade-Related Aspects of Intellectual Property Rights (TRIPS): Computer programs, whether in source or object code, shall be protected as literary works under the Berne Convention (1971)) because it is written by a developer for both human readability and computer execution. Typically, the creator of a copyrighted work is its owner, which means that, in most cases, the developer who writes the source code holds the copyright.
It’s a common misconception that paying for software development automatically grants you ownership of the source code. In reality, the ownership of source code involves complex legal considerations. This includes local and international copyright laws, the terms outlined in contracts or employment agreements (for in-house development), the specifics of the project scope, and any additional relevant documentation. Understanding these factors is crucial to determining who holds the copyright to the source code.
Who Owns Source Codes?
When Party A contracts Party B to write a computer application, the ownership of the copyright and source code typically depends on the terms of the contract between the two companies. The following factors outline how ownership might be determined:
- Contractual Agreement: The contract should specify who owns the copyright and source code. Often, these agreements include clauses that transfer ownership of the source code and related intellectual property rights from Party B to Party A upon completion of the project. This is a common practice in software development contracts.
- Work-for-Hire: If the contract specifies that the work is a “work-for-hire,” Party A is generally considered the author of the software and thus holds the copyright. In such cases, Party B would typically be compensated for their services but would not retain rights to the source code.
- Default Copyright Laws: If there is no explicit agreement or the contract is silent on copyright ownership, default copyright laws apply. In many jurisdictions, the creator of the code (Party B, in this case) initially holds the copyright. Without a transfer agreement, Party A might only have a license to use the software rather than ownership of the copyright.
- Custom Agreements: Sometimes, companies negotiate custom agreements where Party B retains ownership of the source code but grants Party A an exclusive or perpetual license to use it.
The Concept of Work for Hire
“Work for Hire” – WFH is a legal concept in intellectual property law where the ownership of a created work automatically belongs to the employer or the commissioning party, rather than the individual who created it. This principle is commonly applied in employment contexts where employees create works as part of their job duties.
For instance, software developers writing code for a company’s product, designers creating marketing materials, or writers producing content for a publication are typically considered to be creating “works for hire.” The ownership of these works, including any associated copyrights, resides with the employer from the moment of creation, provided that the work is within the scope of employment.
In the case of independent contractors, the work-for-hire doctrine requires a written agreement explicitly stating that the work being commissioned is considered a work for hire. Without such an agreement, the independent contractor usually retains the copyright to the work, even if they were paid to create it.
This distinction is crucial in industries like software development, where code created by contractors might otherwise lead to disputes over ownership rights. Clear, written contracts are essential to define ownership and avoid potential legal issues, ensuring that all parties understand and agree to the terms of the work being produced.
Conclusion
The controversy over source code ownership is a multifaceted issue that requires careful consideration of legal, contractual, and ethical factors. As software continues to play a critical role in modern society, understanding and addressing the complexities of source code ownership is essential for fostering innovation, protecting intellectual property, and maintaining harmonious professional relationships. By adopting clear agreements and best practices, developers and organizations can navigate this challenging landscape and avoid potential conflicts.
Source code is considered a literary work eligible for copyright protection, given that it is written by a developer for either a computer or human to read. Typically, the developer, as the author, would hold the copyright. However, if a business commissions a developer to create the source code, the business may own the copyright. This rule can be altered by a contract or agreement between the parties. Therefore, it is essential to clearly establish who owns the source code before the development process begins.
Emmanuel is a Data Privacy Consultant | Member. IIPGH
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