EU Ruling Mandates Resale Option for Digital Games

The European Union's Court of Justice has ruled that consumers within the EU can legally resell downloaded games and software, overturning restrictions imposed by End-User License Agreements (EULAs). This decision, stemming from a legal dispute between UsedSoft and Oracle, hinges on the principle of copyright exhaustion.

Copyright Exhaustion and Resale Rights

The court affirmed that once a copyright holder sells a copy of software and grants the user unlimited usage rights, the distribution right is exhausted. This allows for subsequent resale. This applies to games and software purchased through platforms such as Steam, GOG, and Epic Games. The original purchaser gains the right to transfer the license, enabling another user to download the software. The ruling clarifies that the original owner relinquishes access upon resale. However, the ruling doesn't define a formal resale marketplace, leaving practical implementation details unresolved. Issues such as account transfers remain unclear, particularly concerning the registration process.

Limitations on Resale

While consumers gain resale rights, the seller can no longer access or utilize the game post-sale. The court emphasizes that continued use after resale constitutes copyright infringement. The ruling also clarifies the distinction between reproduction rights and distribution rights. Reproduction rights remain with the copyright holder, although necessary reproductions for legitimate use are permitted. This allows the new buyer to download the software. Importantly, the court specifies that backup copies cannot be resold.

Implications for Publishers and Consumers

The decision challenges publishers' attempts to restrict resale through EULA clauses within EU member states. While offering consumers a new avenue for second-hand digital purchases, the lack of a defined resale system presents logistical complexities. The ruling clarifies the legal framework, but the practical implementation will require further development. The ruling also highlights the ongoing tension between copyright protection and consumer rights in the digital marketplace.