How use of programs differs from their use

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One of the essential conditions of a software license agreement is an indication of the permitted methods for its use. However, we are not talking about the description of functional capabilities or about the procedure for using the programs for their intended purpose, as is often the case in many license agreements. The latter is especially evident in the example of license agreements for the use of Internet services based on the SaaS model.

Since the license agreement is aimed at providing the right to use, the absence in it of an indication of the methods of use that correspond to the requirements of the law or their substitution by fictitious methods automatically entails the possibility of recognizing such an agreement as not concluded.

In this case, there are also tax risks of refusal to apply VAT exemptions provided to companies on the general taxation system under software license agreements on the basis of paragraphs 26, paragraph 2, article 149 of the Tax Code of the Russian Federation. See the explanation under the cut.

Copyright regulates the circulation of copies of works, including software. Therefore, the legal ways of using the software should be understood only as actions aimed at transferring their copies to third parties. The extraction of useful properties of the software in the framework of using its copy does not apply to the methods of use by law.

The main ways to use the works are listed in Article 1270 of the Civil Code of the Russian Federation. Among them, the following can be attributed to the methods of using the software:
  • software playback , i.e. there is the manufacture of one or more copies of the software or its part in any material form, including writing to computer memory;
  • software distribution by sale or other alienation of its copies;
  • public display of the software , that is, any demonstration of a copy of the software on the screen using a television frame or other technical means in a place open for free visits, or in a place where there are a significant number of people who do not belong to the usual family, regardless of what is perceived Software in the place of its demonstration or in another place simultaneously with the demonstration of software;
  • Import software copies for distribution;
  • rental software instance when the program is the main rental object;
  • software modification , i.e. any of its changes, including the translation of such a program or such a database from one language into another language, with the exception of adaptation, that is, changes made solely for the purpose of operating a computer program or database on specific technical means of the user or under the control of specific user programs;
  • bringing the software to the public in such a way that any person can access the software from anywhere and at any time of their own choice (making it public), i.e. transferring an instance over the Internet.

The list of methods for using software established in article 1270 of the Civil Code of the Russian Federation is open, i.e. legislation does not exclude the possibility of other ways. However, such methods should relate directly to the transfer of software instances, and not the practical implementation of the functionality embedded in them, as we have clearly illustrated above.

Thus, the use of programs for their intended purpose, the adaptation of programs by tuning them using the embedded internal capabilities do not apply to use. Consequently, remote access to software and various cloud services based on it also cannot be considered as a legal way of using it under a license agreement.

Formulate the terms of the license agreement correctly. Then tax incentives can be used without unnecessary risks.

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