SaaS Agreements – Software – Copyright Protection

SaaS Software with the same functionality can co-exist without there being an infringement of copyright, following the recent opinion of the Advocate General in SAS Institute and World Programming Ltd. The Advocate General advised that it is the methods used to create the means for the software to carry out its functions, not the functions of the software and the programming language which can be protected by copyright.

What is Copyright?

Copyright is the right to stop others from copying works without permission. Copyright in SaaS software derives from the software being an original literary work. Copyright protects the expressions of ideas in the SaaS software NOT the ideas themselves.

SAS Institute and World Programming Ltd

The High court referred this case to the European Court of Justice (ECJ). World Programming Ltd was accused of infringing copyrights in SAS Institute software as a result of using information contained in the SAS Institute manuals (not the source code) to develop rival software. SAS Institute argued that the functions of its software were copyright protected pursuant to the Computer Programs Directive. This Directive protects copyright in the expression in any form of a computer programme. It does not however cover ideas and principles which underlie any element of a computer programme, including those which underlie a computer programme interfaces.

Are Software Functionalities Protected by Copyright?

The Advocate General ruled that the functionalities of software are simply “the service which the user expects” from the computer programme. For example, when using software to book an airline ticket the functionalities of the booking process will be the same regardless of which company’s software you use. Such services cannot be protected by copyright. However, what can be protected by copyright, is the means by which the functionalities are achieved as this reflects the author’s own intellectual creation. Protection will depend upon the degree of originality in the writing of the software.

This is not the end of the matter, as the ECJ still has to make a ruling on this case. However the ECJ usually follows the opinion of the Advocate General. In which case, the ability of SaaS software suppliers to prevent the functionality of their software being replicated in the future will be limited, if it is not the SaaS software source code that is replicated.


Irene Bodle is an IT lawyer specialising in SaaS agreements with over 10 years experience in the IT sector. If you require assistance with any SaaS, ASP, software on demand contracts or any other IT legal issues contact me:

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