Hungary: The Modification of the Hungarian Copyright Act

The new Hungarian Copyright Act (Act LXXVI of 1999; hereinafter referred to as CA), which only just entered into force two years ago, has been modified from the effective date of 01.01.2002. The reason and essence of the modifications are the creation of a morely worked out and powerful legal instrument due to the increased protection of darabases, and with the same time, Hungary’s obligation for legal harmonization taken on against the European Union.

The need of modifications has reasoned partly by the technological development, mostly of computer technology. Nowadays it is widely known, that by the spreading of the information society, data – the information relating any elements of the world – have reached an importance never before experienced. Both the quantity of the accessible information and the connecting need of systematization and computerization, and the quality of information with the growing economical value, do cause an expectation for a higher legal appreciation and protection, since the producers of databases, those who invest intellectual and financial means in creating databases have the interest to keep their disposition.

At the same time, the technological development made it possible to on-line access digital-based databases. This technological level provides a wide possibility for database producers to operate the database on financial grounds, with profit gaining purposes, but on the other hand, it makes the database producers defenseless against unlawful access and use.

The above described circumstences raise a challenge also for legislation, since more and more people – as producers or users – are touched directly by producing and using databases.

The aforementioned processes and the need arising from them, established an expectation for the EU legislation to create the legal regulation of databases with increased protection. So was published the directive 96/9/EC of the European Parliament and the Council of the European Union on the legal protection of databases.

Since the association agreement between Hungary and the EU and its member states and the Hungarian Act I. of 1994 on the announcement of the association agreement contains Hungary’s legal harmonization obligation, the above directive must have been transplanted into Hungarian law due to this obligation, beside the formerly mentioned needs. So was passed the Hungarian Act LXXVII of 2001 on the modification of the Act LXXVI of 1999 on copyright.

1. First of all, it must be legally defined, what a database really is, which is toched by the modifications.

Before having been modified, the CA had not contained a separate definition for databases, but has handled it as a compilation (Section 7):

It appears from the cited provisions, that databases are qualified as works of creation (so they can be protected by copyright) only if the collection, arrangement, or editing of their content is individualistic and original.

For better understanding, a definition of works of creation must be placed here. According to the CA:

All literary, academic, scientific, and artistic works are protected by copyright, regardless of whether they are designated in the CA, which only lists the particulars of this kind.

Otherwise, the content itself – apart from the database – does not need to be protected by copyright. Moreover, the sui generis copyright protection of databases becomes clear by the fact, that databases are due to be protected even if the content itself is expressively not protected by copyright. For instance, this is the situation with law compilations even widerly known and used, where the content is not protected according to the Section 1 subsection 4 of the CA.

Modificative provisions, that entered into force in 01.01.2002. already give a closer definition for databases. According to the new Section 60/A of the CA:

In the application of this Act, databases are: compilations of independent works, data or other content elements, arranged by any system or method, of which content elements can be accessed individually by computer technology or any other way.

At the same time, the exemplificative list of works of creation in Section 1 of the CA has been grown by databases qualified as compilations, and the parallel modifications in Section 7 contains the provisions concerning compilations in harmony with the new and developed provisions concerning databases.

2. About the formal-structural modifications

Into the Third Part of the CA, which contains the neighbouring rights, a new Chapter XI/A was inserted, titled as Rights connecting to copyrights. This new chapter, though being isolated in the structure of the CA, contains the regulation of the sui generis protection of databases, harmonizing with the general provisions.

It is worth remarking, that the subtitle of the Third Part was modified from Neighbouring rights to Rights connecting to copyrights. At the same time, Chapter XI is about neighbouring rights in the future too, the aforementioned Chapter XI/A is about the protection of database producers. By this distinction, it is perceptible, that neighbouring right holders and database producers represent different legal qualities, though the latters are qualified as neighbouring right holders in the future too, under the section 84/E subsection 3 of the CA.

3. The definition of database

Natural persons, legal persons and economic companies without legal personality can be qualified as right holders in other words database producers, that initiate the production of databases in their own names or at own risk, providing the necessary costs. (Section 84/A subsection 6)

In need of the rising of the copyright protection, a meaningful cost from the producer is necessary in order to possess, control or display the content of the database. (Section 84/A subsection 5). The minimal level of the right-creating effect of the meaningful costs are obviously to be specified by the judicial practice in the future.

According to the personal scope of the new rulings, the sui generis protection is due to the database producer – if international treaties order no other –, if

he is a Hungarian citizen, or he has a usual residence in Hungary, or

the economical company is registered in Hungary and its headquatrers defined in the articles of association, or the place of cental administration, or the main place of business activities is in Hungary, and its operations are permanently and effectively connected to the economics of the Hungarian Republic. (Section 84/A, subsections 9-10)

4. The effective content of the protection (the rights of the database producer) can be summarized according to the new regulations as follows. (Sections 84/A – 84/E)

The new regulations specify the sui generis protection of databases as being totally independent from other copyright or any other protection of the producer. It means that database producers are provided with all the rights specified in the new Chapter XI/A., even if the components or parts of the content is not protected by copyright.

The effective content of the protection of database producers is very similar to the coyright protection of copyright holder and neighbouring right holders. Just like the latter ones, database producers are provided with protection in absolute structured legal relation. The protection starts from the date of the completion of the database, in other words, for the origin of the protection there is no need for any egistration.

The rights of database producers are composed of two parts:

• the right of duplication, making excerpts and copies, and
• the right of utilization and re-utilization.

Utilizations defined above and specified in the CA are the producer’s exclusive right (Copying and re-utilization: Section 84A subsections 1-3;), and the producer is also entitled to receive an adequate equivalent for licensing. (Section 84/A subsection 4)

The sui generis protection acknowledges the cases of free utilizations, as the exceptions of the above general provisions.

According to these, the license of the database producers is not necessary for the – even repeated and regular – copy or re-utilization of insignificant parts of published databases by rightful licensees. This way of utilization can not be harmful for the ordinary utilization of the database and it can not damage without reason the rightful interests of the database producer. (Section 84/B.)

Everyone is entitled to copy also a meaningful part of the database for personal purposes, if it does not serve – even indirectly – the purpose of income gaining or increasing.

Computer- ased databases (for instance CD-ROMs) can not be copied the above way.

With the indication of the resource, even meaningful parts of databases can be copied for purposes of school education and scientific research – with suitable methods and degrees – , if it does not serve – even indirectly – the purpose of income gaining or increasing.

In judicial, administrative or other proceedings, even meaningful parts of the content of the database can be copied or utilized for proving puroses with suitable methods and degrees. (Section 84/C)

The protection period concerning databases is defined as follows.

The protection period starts in the first day of the year following the year of the first publication of the database and it lasts for fiftheen years. The starting time may also be the first day of the year following the year of the completing of the database, if the database was not published. This protection period is meaningfully shorter than periods in cases of works of creation or neighbouring rights.

At the same time, the protection period start again in cases of databases – as a new appearance in the area of copyright law – if the content of the database is modified, by which modification the database can be independently qualified as produced with meaningful costs. This modification can be arising from the accumulation of following changes, enlargements, leaving or updates.

Latter provision makes it possible, that permanently updated databases (for instance, the aforementioned law compilations) can be provided with protection not only from the time of production for a certain period, but for the whole time of the permanent production and investments.

In the area of database protection there are also rights that can not be exercised individually due to the character or circumstences of the utilization. The enforcement of these rights can be carried out by collective rights management, for which special organizations may be established by law or by the will of the right holders. So database producers can exercise their mentioned rights - just like other copyright and neighbouring right holders – by collective rights management organizations, which operate for this special purpose.

Collective rights managemet organizations must be registered officially at the Ministry of Culture before starting their activities. At the moment, the registration process is in progress, after which the Database Copyright Association will probably do the administration connecting to collective rights management.

5. Other provisions relating databases

The new Section 99 of the CA declares that legal sanctions for copyright infringements must be applied in cases of database right infringements and accessory technical measures.

On grounds of this provision, the database protection, which is different from copyright and neighbouring right protection in many aspects, appears to organically fit into the system of copyright.

Previously a mention was made of the growing importance of data, information and databases in everyday life.

The transplantation of the new regulation concerning database protection was already raised at the time of the making of the CA, as a legal instrument harmonizing with the EU law. At that time the legislator did not find the time had come for the realization of the increased legal protection.

It seems, that beside the pressing legal harmonization obligations of Hungary, challenges of the technological development had raised the argument for transplanting the EU directive in question into Hungarian law. The new regulation will hopefully meet the expectations, and it will provide an adequate protection for databases produced with great intellectual and financial investments.