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Second Bavarian IT-Day
by Stephan Meyer*
First published on November 20, 2003

On the first seriously cold day in the Fall of 2003, information technology law professionals gathered in the Künstlerhaus at Lenbachplatz in Munich, Germany. This was the second annual meeting. In his introduction, Anton Mertl, President of the Bavarian Lawyers' Association, noted that a very young tradition was being continued and solidified (see the report on the First Bavarian IT Day). Indeed, most of last year's attendents made a repeat appearance. Mr. Mertl noted that fewer business professionals attented this year although the meeting was scheduled to coincide with the Systems computer fair in Munich.

In the 2002 format, participants had to select one of two different afternoon programs; in 2003, the format involved a single track. This change meant all participants would experience all of the sessions. Also, excellent conference papers covered the entire program.

The first presentation, by Dr. Markus Junker, addressed the intricacies of electroniccally expressed, legally significant acts or "Willenserklärungen" (expression of intent, an important legal concept in German law) and the conclusion of contracts on the Internet under § 312b BGB (Bürgerliches Gesetzbuch, the German civil code). §. 312b stipulates a number of obligations for online vendors. Among other things, a buyer must be able to correct the details of an order before issuing a binding offer to buy, and a vendor must confirm the receipt of the order separately from its actual acceptance. In the event of a breach of these obligations, the buyer may be able to recover damages under § 280 I BGB. Because the required confirmation of receipt is distinct from the acceptance of the buyer's offer, it ought to worded in a manner not to be confused with the acceptance itself. Otherwise the vendor may unwittingly be contractually bound. Junker did not provide concrete propositions for exactly when an electronic Willenserklärung is received and thus becomes binding. The receipt could take place upon storage on the internet provider's mail server, or later, e.g. at the time the message is downloaded to the mail client on the recipient's computer. During the following discussion it was noted that the various Internet greeting card services provide a way of confirming the receipt of a message, since they notify the sender when the recipient has downloaded the greeting card.

Next, Dr. Andreas Leupold was scheduled to provide an overview of the new "Mehrwertdienstegesetz" (Added Value Services Act) and of problems associated with so-called "sniper" software. In his place, Mr. Jyn Schultze-Melling gave the presentation. The Mehrwertdienstegesetz was enacted in response to so-called "Dialer" software. These trojans reconfigure the victim's Internet access settings in such a way that expensive premium rate telephone numbers are used. Germany is one of the countries where such abuse occurs. Frequently, users do not detect such abuse because the abusers attempt, and mostly succeed, in hiding the dialer feature in innocuous software. The new statute aims to heavily regulate the use of premium rate telephone numbers in order to prevent their misuse. The effectiveness of this approach is yet to be shown. Quite likely, the perpetrators will continue to operation, without applying for the required license and and avoid submitting themselves to the regulation requirements in the hope that phone subscribers will either not detect or not act upon the high charges incurred.

Other interesting legal issues result from the use of "sniper" software which is used to enter a bid in an online auction just moments before it closes. This scheme allows almost no reaction time for other bidders. It enables its user to win the auction at a manipulated low cost which reduces the attractiveness of online auctions and endangers the business model of online auctions. Claims for damages against the makers of sniper programs may arise out of the laws of torts and unfair competition. Future case law may determine whether the seller in an auction may have a cause of action under the theory of a breach of pre-contractual obligations.

In his presentation on the amended Copyright Act, Prof. Dr. Michael Lehmann discussed the so-called right of making-available and provides for legal protection of digital rights management (DRM) technologies. In the past, he explained, the statute was limited to the protection of the copyrightable works. However, DRM measures are protected only if they are "effective" (§ 95a UrhG). This effectiveness though is often inversely proportionate to the ease of access to digital content by the ordinary user.

After the lunch break, Michael Intveen turned to current developments in the new "EVB-IT", a set of uniform procurement contracts for use by state bodies. Their purpose is to enable a non-lawyer to procure products and services from private IT companies without the need to worry about technicalities. The speaker emphasized that some of the standard terms disadvantage the procuring agency, so that they would not hold up in court when employed on the seller's side. He also noted that in a so-called "system contract", where hardware, software and support are purchased in one package, the various separate contracts ought to be linked in such a way that all of them are affected by a failure to perform.

Subsequently, Dr. Mathias Lejeune talked about warranty and liabilty terms in German and international software agreements. In German law, the effects of the recent reform of the law of obligations remain a dominating topic. For example, it is feared that the courts might apply the rationale of the European directive on the sale of consumer goods to cases where only businesses are involved. By contrast, in American law, the main problem appears to be a lacking uniformity of applicable laws. While the Uniform Computer Information Transaction Act (UCITA) was developed to govern the emerging e-commerce, it went into force only in two states because of strong opposition from consumer rights groups. It should also be noted that in the US, the sale of software with far-reaching limitations on its use is permissible, whereas in Germany, such terms are deemed invalid. This is just one aspect of a greater freedom of contract, limited only by unconscionability.

Dr. Oliver Steffens gave the closing presentation on the evolution of German and European Competition Law. One of the planned changes would remove the need to formally obtain an exemption for competition restraints. Yet with the benefit of a binding decision removed, the competitors themselves will be responsible for ascertaining the legality of such agreements. In German competition law the same change is envisaged as is the abolition of the distinction between horizontal and vertical competition restraints. This would bring the national law more in line with European statutes, increasing the competitiveness of German companies in the Common Market. Whereas the current rules would mostly be relaxed, they would be tightened in the field of exclusivity agreements. Thus, consulting services will be in high demand in this area.

The Second Bavarian IT Day ended in the same comfortable and professional atmosphere which could be felt at the outset. Again, it provided an opportunity to learn first-hand about current developments and to network. It should be hoped that the event will continue its success.

*   Stephan Meyer is a fourth-year law student at Ludwig-Maximilians-Universität in Munich, focusing his studies on intellectual property and competition law. He can be reached at stephan.meyer@amlaw.us.


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