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PREO Chairman Boris Vöge on the Usedsoft case against USC – Caution when buying split software licences.
Hamburg, 20/07/2016.. Last week, the Düsseldorf Higher Regional Court handed down a final verdict on the Usedsoft dispute against USC. Despite the software dealer’s request for an appeal, USC may continue to voice criticism on the split volume licence trade. Whether its individually from a volume contract or in a package is ultimately of secondary importance. Instead, people must act cautiously in relation to secure origin.” believes Boris Vöge, Chairman of PREO Software AG. The specialist for used software has been trading in licences from volume contracts for 10 years.
For many businesses and authorities, purchasing used software licences is a variation on software procurement that is kind to a budget and is legitimate – It doesn’t matter whether this is individual licences from volume contracts or in a package. The FSH (2014) and ECJ (2012) confirmed the following a while ago: Buying and selling used software is legal – and that includes trading in split software licences. “However, more and more rumours are being spread and processes followed that discredit reputable trade and ultimately damage the reputation of the sector”, believes the PREO chairman: “That’s why clarity on the current legal situation and correct procedure is a must.” Vöge advises asking for documents when buying individual and volume licences second-hand that are required to declare the exhaustion prerequisite: “Only when dealers allow for the required transparency at all stages are users actually on the safe side – even in the case of an audit.”
Last week, Düsseldorf Higher Regional Court delivered a controversial verdict in the Usedsoft dispute against USC. The licence advisor advised “caution when buying split volume licences” – for which the German Federal Supreme Court had already given the green light in 2014. Usedsoft had taken legal action against the public attack and lost. Almost at the same time, a decision was handed down against Adobe. The software manufacturer has to pay the dealer 125,000 euros in compensation after Adobe had contested correct sale of individual licences from its volume packages in 2010, and threatened customers of several used software retailers with legal action. This had a long sequel in court, which the manufacturer is now being retrospectively prosecuted for.
The customer has an obligation: Proof of usage rights and the chain of rights
“However, the warning about split second-hand volume licences is a rough generalisation”, explains Boris Vöge: “The fact that a single licence cannot be split any further makes good commercial sense.” It’s definitely relevant to see what’s being offered to you for used licences. This is why PREO Software AG advises a healthy amount of scepticism: “Certainly when it comes to origin. Buyers should always insist on a clean licence transfer chain”, advises the PREO Chairman: “Many dealers only refer to notary attestations or seals of quality. However, this does not suffice as proof in an audit. If a manufacturer registers an inspection, the customer must be able to show his/her usage rights for the used software licences that have been installed, to not have to request a relicence.” He believes that an important point for auditing is evidence of the exhaustion prerequisite – which means, amongst other things, where the software has come from, disclosing the chain of rights and proof that the initial purchaser has made the software unusable by himself/herself and does not retain a copy of the program. To be able to prove the legality of the used software with respect to the software manufacturer if required, transparency is therefore a basic prerequisite when trading in used software. “If this is not granted, the question of origin remains unanswered”, according to Vöge.
At the time of purchasing used software, PREO Software GmbH delivers a clean, traceable licence transfer chain: “As a result, our customers are able to view and show their usage rights and correct software origin – and so they are on the safe side in the event of a manufacturer audit.”