Amendments made to Hungarian Copyright Act

Hungary

The Hungarian parliament has amended and modified the Hungarian Copyright Act (the “Amendment”) in order to implement EU Directives 2019/790 and 2019/789. The most relevant parts of this Amendment are summarised below.

Obligation to provide information to right holders

The Amendment places a significant burden on the users of license agreements. Beginning 1 January 2022, users of license agreements must provide information to right holders each year on the use of their work, the manner and extent of the use, the revenues deriving from each separate means of use, and the remuneration to be paid to the right holder. An important element is that the Amendment explicitly provides that this information-sharing obligation cannot be excluded in the license agreement. Although the Amendment does not set out any formal requirements on how the information must be provided, the scope of data to be provided by the user is so wide that the user will inevitably be required to issue regular written notifications in order to comply with this obligation.

Rules for content-sharing service providers

The Amendment provides a definition for content-sharing service providers and sets out special liabilities for these service providers. As such, special provisions apply to a “provider of an information society service of which the main or one of the main purposes is to store and give the public access to a large amount of copyright-protected works or other protected subject matter uploaded by its users, which it organises and promotes for profit-making purposes”. Clearly, the definition intends to “capture” a huge variety of service providers.

The default position is that these service providers will be liable for acts of communicating and making illicit copyright-protected works available to the public. Service providers can avoid liability for unauthorised conduct if they demonstrate that they have fulfilled three cumulative obligations:

  • they have acted with the highest level of diligence that can reasonably be expected for obtaining the right holder’s authorisation to use the work;
  • they have made their best efforts to ensure, in accordance with industry standards and best practices, the unavailability of the works for which the right holders have provided relevant and necessary information; and
  • after receiving a sufficiently substantiated notice from the right holders, they have acted expeditiously to disable access to, or to remove from their websites, the notified works, and made their best efforts to prevent future uploads.

Failure to meet one or more of the above obligations does not trigger the automatic liability of the service provider. According to the Amendment, the assessment of the service provider’s overall conduct must be carried out by taking into account the main elements of the case concerned and in the light of the proportionality principle.

Rules on out-of-commerce works

In order to ensure harmonisation with the CDSM Directive, the Amendment defines the scope of out-of-commerce works, and the rules relating to the use of such works. Under the Amendment, a work is considered out of commerce when it can be presumed that the entire work is not available to the public through customary channels of commerce, after a reasonable effort has been made to determine whether it is publicly available. The aim of providing a separate regulation for these works is to ensure that they do not get excluded from cultural circulation. This is achieved by granting the institutions responsible for the protection of cultural heritage a right to reproduce and communicate these works to the public in the framework of a collective rights management regime, provided that the out-of-commerce works are their property or are permanently in their possession.

Rule on protection period of databases

The Amendment includes a new protection term to exercise the rights of the producers of databases. Such rights will be under protection for 15 years from the first day of the year following the year in which the first publication of the database took place, while if the database was not published in the interim period, the protection period starts on the first day of the year following the year in which the database was created.

Non-exclusive software licenses do not require written agreements

The Amendment also clarifies that agreements on non-exclusive software licenses no longer need to be concluded in written form, therefore such agreements may also be concluded verbally. This means a paper format or a qualified/advanced e-signature is not necessary for signing non-exclusive software licenses, which can be concluded online with click-through agreements or a simple electronic signature.

For more information on this Amendment and copyright laws in Hungary, contact your CMS client partner or local CMS experts: Dóra Petrányi, Ágnes Sólyom, Miklós Boros