Exceptions for computer programs

17.25 In addition to the exception for backing-up, there are other exceptions for computer programs in pt III div 4A of the Copyright Act, namely:

  • reproduction for normal use or study of computer programs (s 47B);

  • reproducing computer programs to make interoperable products (s 47D);

  • reproducing computer programs to correct errors (s 47E); and

  • reproducing computer programs for security testing (s 47F).

17.26 Contracts that exclude the operation of these exceptions are largely unenforceable.[19]

17.27 These exceptions were introduced, and one was amended, by the Copyright Amendment (Computer Programs) Act 1999, following a 1995 Copyright Law Review Committee report on computer software.[20] The Explanatory Memorandum explained the objectives of the new provisions:

The objectives of allowing decompilation are: a) for interoperability—to put Australian software developers on a competitive footing with their counterparts in Europe and the USA and increase the range of locally produced interoperable computer products available to the wider community; b) for error correction, including combating the potential disruption to business and the community by the Y2K bug in many computer programs; and c) for security testing—to combat the potential disruption to business and the community by computer hackers and viruses.[21]

17.28 A few stakeholders commented on the importance of exceptions for computer programs. The ADA and ALCC stated:

The activities covered by the computer software exceptions are critical to ensuring that computer programs and IT networks work safely and securely. These exceptions are particularly important in an environment where homes and business are becoming increasingly connected to the internet and are reliant on computer software for performing everyday tasks. Ensuring that computer software can be reverse engineered to enable the creation of interoperable products is also an important competition goal.[22]

17.29 The computer program exceptions attracted limited comment in the initial stages of this Inquiry, however some stakeholders pointed out a number of problems with them.[23] Robert Xavier submitted that the definition of computer program is too narrow, as it is too often confined to ‘literary works’, which would not cover images, audio and films that are often part of computer programs, such as computer games.[24]

17.30 The exception for making interoperable products in s 47D seems to be the most problematic, and was said to be ineffective for a number of reasons. It does not allow programs to be ‘reproduced in the interoperable program, which severely limits its use’.[25] It ‘does not appear to extend to copying necessary to make software work with hardware’.[26] And to create an interoperable program, it is often not practically possible to reproduce programs only ‘to the extent reasonably necessary to obtain the information’, as is required by the exception.[27] The Federal Court in CA Inc v ISI Pty Ltd called it a ‘very limited exception’.[28]

17.31 The Internet Industry Association submitted that the exceptions for reverse engineering and interoperability in ss 47B and 47D are too narrow and ‘seriously out of date’:[29]

The very limited nature of the rights to copy for the purpose of reverse engineering (s 47B and s 47D) is also an impediment to those wishing to study code in order to create new and/or interoperable systems. Note in particular that the relevant provisions do not permit reproduction for the purpose of testing interoperability.[30]

17.32 The Business Software Alliance, on the other hand, submitted that the existing exceptions should be retained: they provide certainty and clarity for users and rights holders, and they represent an appropriate balance.[31]The fact that Europe and the US have specific exceptions relating to software uses may also support this view.[32]

17.33 In light of some of the problems highlighted above—problems not discussed by those supporting the existing provisions—the existing computer programs exceptions may be in need of revision. Xavier suggested that one option would be to ‘scrap the whole division and start again’.[33]

17.34 Another option would be to repeal the existing exceptions, and apply fair use or the new fair dealing exception, to determine whether these unlicensed uses of computer programs infringe copyright. The Internet Industry Association said it would be a ‘futile exercise’ to update the existing exceptions, and instead, favoured a principles-based approach.[34] Others submitted that the fair use exception may ‘provide some leeway to Australian courts to consider the competition-enhancing benefits of reverse engineering and other acts covered by the computer program exceptions such as security testing and error correction’.[35]

17.35 Some stakeholders submitted that an additional illustrative purpose could be added to the fair use provision, such as for ‘interoperability, error correction and security testing’.[36]

17.36 In the ALRC’s view, if fair use is enacted, further consideration should be given, and consultation with industry conducted, before repealing these exceptions. If the existing exceptions are retained, then the Act should be clear that they do not limit the application of fair use.

17.37 If fair use is enacted, it may also be necessary to introduce limitations on contracting out of fair use to the extent that it applies to particular uses of computer programs.[37]