I. Current situation concerning software usage rights after assignment
In practice, the issue of software usage rights after assignment has led to numerous complexities due to the dual legal nature of software which is both as a commercial product (goods) and as an intellectual property asset. Particularly, after purchasing or receiving assigned software, many businesses don’t understand the limits of their usage rights, resulting in improper use, installation beyond the licensed quantity, or unauthorized modification and duplication of the software.
Moreover, there remains a widespread misconception that software assignment is equivalent to a full transfer of intellectual property ownership, whereas the law only permits the transfer of usage rights (licenses) within a defined scope. Such misunderstanding has resulted in multiple disputes between developers and users, particularly when the software is redistributed, commercialized, or integrated into another product without authorization.
Additionally, the lack of clearly defined contractual terms, such as the duration, scope, and permitted usage form has exposed many businesses to legal risks, especially in transactions involving foreign elements or internationally copyrighted software.
II. Definition of software usage rights after assignment
In today’s developing technology-commercial market, software assignment has become a widely adopted method enabling organizations and businesses to effectively exploit intellectual property assets in information technology. However, to avoid confusion between “usage rights” and “ownership rights”, it is essential to have a clear understanding of the legal nature of software usage rights after assignment.
1. What are software usage rights after assignment?
Software usage rights after assignment refer to the rights granted to the assignee (the purchaser or licensee) to use and exploit the software within the scope, duration, and conditions stipulated by the contract or the law. These rights do not include possession or disposal of the software as a tangible asset.
2. Distinction between software usage rights and software ownership rights
- Software usage rights: The right to operate or exploit software within a defined scope (e.g., installation limitations, internal use only, or commercial use). The user is prohibited from copying, modifying, or distributing the software without the copyright owner’s consent.
- Software ownership rights: Full rights over both property and moral interests in the software, including the right to copy, distribute, modify, assign, or sublicense. The software owner has exclusive authority to determine how the software is used and commercially exploited.
Accordingly, after the assignment, the receiving party only obtains the right to use the software within the licensed scope and does not automatically acquire copyright ownership or proprietary rights over the software.
III. Legal provisions governing software usage rights after assignment
In the context of rapid digital economy development, software usage rights after assignment have become an important legal concern, directly affecting the rights and obligations of parties in a software assignment contract. Vietnamese law provides specific regulations governing such matters, ensuring transparency, fairness, and protection of intellectual property rights.
1. How are software usage rights legally established?
Under Article 22 of the Law on Intellectual Property 2005, as amended in 2009, 2019, and 2022, computer software (computer programs) is classified as a copyright-protected work.
To lawfully assign software usage rights, it must satisfy the legal conditions on copyright assignment stated in Articles 45 and 46 of the Law on Intellectual Property 2005, under which assignment contracts must be made in writing.
Therefore, the establishment of usage rights after assignment must be implemented through a written copyright assignment contract, which must contain the following essential elements:
- Full name and address of the assignor and the assignee
- Legal basis for the assignment
- Price and payment method
- Rights and obligations of the parties
- Liability for breach of contract
2. How does Vietnamese law regulate software usage rights after assignment?
Copyright over software consists of moral and property rights. According to Article 45 of the Law on Intellectual Property 2005, moral rights (such as the right to name the work and to be recognized as the author) are non-transferable, whereas property rights (e.g., the right to copy, distribute, use, or assign usage rights) may be transferred to another organization or individual.
The assignee may only perform acts within the permitted scope and must not modify source code, or copy or re-distribute the software without authorization. The software owner still retains moral rights (such as an author and the right to protect the integrity of the work) even after granting usage rights.
Furthermore, according to Clause 2 Article 46 of the Law on Intellectual Property 2005, the execution, amendment, termination, or cancellation of copyright assignment contracts shall comply with the Civil Code.
IV. Questions about software usage rights after assignment
1. Is registration with the State authority mandatory when assigning software usage rights?
Articles 47 and 48 of the Law on Intellectual Property 2005 do not require registration of copyright assignment contracts at the agency. Therefore, assignment of software usage rights is not subject to mandatory registration with the competent State authority.
2. Are software usage rights limited in terms of duration or territory?
Based on the contractual freedom principle, software usage rights may be limited by:
- Duration: For example, the assignee may be granted usage rights for three years or permanence, depending on the agreement.
- Territory: Usage rights may apply only within Vietnam or a specific region.
However, if no specific provisions exist in the contract, usage rights are interpreted within statutory limitations. Article 27 of the Law on Intellectual Property 2005 provides that:
- Moral rights specified in Clauses 1, 2, and 4 of Article 19 are protected indefinitely.
- Moral rights in Clause 3 Article 19 and property rights under Article 20 are protected for the life of the author and 50 years after the author’s death. For joint authors, the term ends 50 years after the last surviving author’s death.
3. What obligations does the assignor have to ensure valid usage rights for the assignee?
The assignor must:
- Ensure lawful ownership of the software prior to assignment
- Deliver source code, technical documents, or operational tools if agreed
- Avoid granting duplicate exclusive licenses to third parties
- Compensate the assignee for damages if the software infringes third-party copyright
4. If the software assignment contract is declared void, do usage rights still remain valid?
Under Article 131 of the Civil Code 2015:
- A void contract doesn’t create legal rights or obligations from the establishment
- Parties must restore original status and return what they have received. If return in kind is impossible, monetary compensation must be provided
- The party legally receiving profit isn’t required to return it
- The party at fault must compensate for damages
Accordingly, once the contract is void, the usage rights granted under it also lose legal validity. The assignee must cease software use and will no longer have lawful exploitation rights.
5. How are usage rights determined in the case of purchasing foreign software packages?
When acquiring software from abroad, usage rights are determined by:
- The assignment or licensing agreement (subject to Vietnamese law and applicable treaties)
- The license terms issued by the foreign software provider, which specify the scope, duration, and method of usage
In cross-border transactions, parties must consider choice-of-law rules to minimize legal risks.
V. Legal consultancy services concerning software usage rights after assignment
If you or your business face difficulties in determining rights and obligations after assignment, or require assistance in drafting, reviewing, or registering software copyright assignment contracts, seeking legal counsel specializing in intellectual property and information technology is strongly advisable.
Legal counsel can assist with:
- Analyzing software usage and ownership rights
- Drafting legally compliant assignment or licensing agreements
- Representing clients in copyright-related disputes
- Registering software assignment agreements with the Copyright Office to ensure legal enforceability
If you require support regarding software usage rights after assignment, please contact NPLAW for timely assistance and to avoid prolonged legal risks and damages.
