At VerikeysHub, we believe customers should have access to genuine software at fair and competitive prices. European law provides an established legal framework governing the distribution, use, and, under certain conditions, resale of software licences.
One of the most important decisions in this area is the landmark judgment of the Court of Justice of the European Union (CJEU) in UsedSoft GmbH v. Oracle International Corp., Case C-128/11, decided on 3 July 2012. The judgment confirmed important principles concerning the exhaustion of distribution rights for certain software licences, including software supplied by download.
What is a software licence?
When you purchase software, you generally acquire a right to use the software under specified licence terms, rather than ownership of the underlying intellectual property.
Depending on the type of licence, its duration, the way it was supplied, and the applicable law, different rights and restrictions may apply.
This distinction is particularly important when discussing perpetual software licences and the European rules concerning the exhaustion of distribution rights.
The landmark CJEU decision: UsedSoft v. Oracle
On 3 July 2012, the CJEU delivered its judgment in Case C-128/11, UsedSoft GmbH v. Oracle International Corp.
The case concerned the resale of software licences that allowed customers to use Oracle software downloaded from the internet. Oracle argued that its licence agreements made the rights non-transferable and challenged the resale of those licences.
The CJEU established an important principle of European copyright law: where the applicable conditions for exhaustion are satisfied, the copyright holder’s distribution right in a copy of computer software is exhausted following the first sale of that copy in the EU/EEA with the rights holder’s consent. The Court also recognised that this principle can apply to software supplied by download, not only to software distributed on physical media.
This decision created an important legal foundation for the European market for certain second-hand or transferred software licences.
Key principles established by the judgment
1. Exhaustion of distribution rights
Where the legal requirements are fulfilled, the first authorised sale of a software copy within the EU/EEA can exhaust the rights holder’s distribution right in that copy.
This means that the rights holder cannot simply rely on its distribution right to prevent every subsequent transfer of that copy.
2. Digital software can fall within the principle
The CJEU specifically considered software supplied by internet download and confirmed that the exhaustion principle is not limited to software distributed on physical discs or other physical media.
This was particularly significant because it recognised the legal importance of digital distribution in the software market.
3. Perpetual licences are particularly relevant
The UsedSoft judgment concerned licences granted for an unlimited period in exchange for payment corresponding to the economic value of the software.
Accordingly, the judgment is especially relevant when assessing the transferability and exhaustion of rights relating to perpetual software licences. It should not, however, be interpreted as automatically making every type of software subscription, account, SaaS service, or time-limited licence transferable.
4. Conditions still apply
The European exhaustion principle is not an unrestricted right to resell any software under any circumstances.
The legal position depends on factors including:
- whether the software was lawfully placed on the EU/EEA market;
- whether the relevant rights were exhausted;
- whether the licence is perpetual or time-limited;
- whether the transaction concerns a licence covered by the applicable legal framework;
- whether the original licence holder has genuinely ceased using the relevant copy or licence where required; and
- whether applicable contractual, copyright, and other legal requirements have been satisfied.
For this reason, every transaction should be assessed according to the characteristics of the particular software licence.
European case law following UsedSoft
The principles established in UsedSoft v. Oracle have also been considered by European national courts.
For example, the German Federal Court of Justice (Bundesgerichtshof) continued to apply and develop the principles concerning exhaustion of distribution rights for software in its subsequent UsedSoft decisions.
In its judgment of 17 July 2013 (I ZR 129/08, UsedSoft II) and its judgment of 11 December 2014 (I ZR 8/13, UsedSoft III), the German Federal Court of Justice addressed the consequences of exhaustion in relation to software copies and their subsequent distribution.
These decisions demonstrate the continuing importance of the UsedSoft principles within the European legal framework.
What does this mean for software customers?
The European legal framework provides an important foundation for competition and access within the software market.
Where a software licence legally qualifies for transfer or resale under the applicable rules, customers may be able to obtain genuine software rights at a significantly lower price than purchasing directly from the original publisher.
This can provide several benefits:
- Lower software costs for individuals and businesses.
- Greater access to professional software for SMEs, freelancers, and other users.
- Reuse of existing software licences rather than unnecessary duplication.
- A more competitive software market.
- Greater transparency around the legal status and origin of software licences.
VerikeysHub: Genuine software, transparency and customer value
At VerikeysHub, our objective is to make genuine software accessible while maintaining transparency about the products and licence terms offered to our customers.
We believe customers should understand what they are purchasing, how the licence may be used, and what limitations or conditions apply.
Where a product is subject to specific licence conditions — including personal-use, educational, commercial, activation, duration, or transfer restrictions — these conditions should be clearly communicated before purchase.
European law provides important protections and principles concerning software distribution and, in appropriate circumstances, the transfer of software licences. However, the precise legal position depends on the specific licence, transaction, territory, and applicable law.
A transparent approach to software licensing
Our commitment is simple:
Genuine software. Transparent licence information. Competitive pricing. Responsible distribution.
The European legal framework surrounding software licences is well established, and the UsedSoft judgment (C-128/11) remains a landmark authority concerning the exhaustion of distribution rights for certain software licences supplied in the EU/EEA.
This information is provided for general informational purposes and does not constitute legal advice. The applicability of European exhaustion rules depends on the specific software, licence, transaction, territory, and circumstances involved.