The role of copyright in design

Construction takes shape not only in plans, but also in legal frameworks. In our INspect-LEX Blog, we explain in plain language the legal concepts and rules that define the world of design and construction.
In the seecond part of our legal blog series, we highlight the role of copyright in design.
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The role of copyright in design

Before signing a design contract, it is crucial for every designer to familiarise themselves with copyright issues, which are almost always included in contracts.

In Hungarian law, provisions relating to copyright are contained in Act LXXVI of 1999 on Copyright.

In addition, the provisions of Act V of 2013 also apply on a supplementary basis.

According to Section 2:55 of the Civil Code, which is a supplementary application, ‘This law shall apply to matters falling within its scope that are not regulated by copyright or industrial property rights legislation, or legislation on the protection of trade secrets.’

„Act No. LXXVI of 1999 on Copyright Article 1.(2) All literary, scientific and artistic creations are protected by copyright, regardless of whether or not they are specified in this Act. Such creations are, in particular:

1. k) architectural works and plans thereof as well as the plans for building complexes and urban architecture,
2. l) designs for engineering structures,”

The provisions affecting designers’ rights can basically be divided into two groups:

Article 9 (1) The entirety of authors’ rights – moral rights and economic rights – shall belong to the author from the time of the creation of the work.

(2) The author may not assign his moral rights and such rights may not devolve to another person in any other manner, and may not be waived by the author.

(3) Subject to the exceptions in Paragraphs (4) to (6), economic rights may not be assigned or may not devolve to another person, and may not be waived.

(6) In the cases and under the conditions specified in this Act, the economic rights may be assigned or shall devolve. Unless otherwise provided for in the assignment contract, the person acquiring the rights may thereafter dispose of the economic rights he has acquired.

1. Group of rights related to the person
2. Making the work public
3. The author decides whether his work may be made public.
4. Before making the work public, any information on its substantial content may be provided for the public only subject to the author’s consent.

1. Indication of the author’s name: The author shall have the right to be indicated on his work or in the communication relating to his work – subject to the scope and nature of the communication – as the author. Reference shall be made to the author in the event of including a part of his work in another work, and quoting or reviewing his work.

1. Protection of the integrity of the work

Moral rights of the author are infringed by the distortion, mutilation or any other alteration of or other derogatory action in relation to his work which prejudices the honour or reputation of the author.

1. Group of economic rights

By virtue of copyright protection, the author shall have the exclusive right to use his entire work or an identifiable part thereof in any tangible or intangible form and to authorise each and every such use. A Licence Agreement may obtain authorisation for the use of the work. Economic rights can be as follows:

1. a) its reproduction (Article 18 and 19),
2. b) its distribution (Article 23)
3. c) its public performance (Articles 24 and 25)
4. f) its adaptation (Article 29),

In summary, designers may waive their property rights in the form of a so-called Licence Agreement.

In practice, provisions that can be identified as Licence Agreements are most often included in design contracts.

Under such an agreement, the author grants permission for their work to be used, and the user is obliged to pay a fee in return.

In practice, the parties usually stipulate that this amount is included in the design fee. Usually, the use of the design is limited to the specific project for which it was created.

The parties shall freely determine the content of the Licence Agreement. They may deviate from its provisions by mutual consent, unless such a deviation is prohibited by this Act or other legislation. The Licence Agreement must be recorded in writing.

It is also important to know that the Licence Agreement shall provide exclusive right to use only by an express stipulation to that end. In the case of an exclusive licence to use, only the acquirer of right may use the work, the author may not grant further authorisations for the use of the work, and even he himself remains entitled to use his work only if this is stipulated in the agreement.

The user may assign the licence or may grant sub-licence to a third person for the use of the work only subject to the author’s express consent thereto.

If the user confers its rights or grants sub-licence without the author’s consent or the licence to use is transferred without the author’s consent, the user and the acquirer of rights shall be jointly and severally liable for the fulfilment of the Licence Agreement.

Unless otherwise provided for by legislation or agreement, the Licence to use shall cover the territory of Hungary and its term shall be in compliance with the period customary in agreements concluded on the use of works similar to the subject-matter of the agreement.

The stipulation of the Licence Agreement whereby the author grants a licence to the use of an indefinite number of works he is to create in the future shall be null and void.

It is also important for designers that, under the law, the License only covers the adaptation of the work if expressly stipulated.

In summary: Based on the legal provisions currently in force, it is advisable to comprehensively and exhaustively regulate copyright issues in design contracts in order to avoid any possible misunderstandings in the future.