http://www.ncl.ac.uk/~nlawwww/articles4/downing4.html
[1995] 4 Web JCLI  7,640 words
Magill and the Software Directive: are they interoperable?

Robbie Downing
Lecturer in Law, King's College, London
<r.downing@kcl.ac.uk>

Copyright  1995 Robbie Downing. 
First Published in the Web Journal of Current Legal Issues in association with Blackstone Press.

Summary
In its recent judgment in Magill, the ECJ held that a refusal to license copyright protected materials could be an abuse of a dominant position under Article 86 of the EC Treaty. The ECJ's analysis could be applied to certain cases where copyright protection of computer programs is relied on to control the creation of a third party product or service, although much depends on how we interpret the ECJ's notion of abuse. Courts would be better advised sensitively to circumscribe the scope of copyright protection under the Software Directive taking into account the experience of US courts. Article 86 is arguably not the proper instrument to strike the balance inherent in the grant of an intellectual property right. Moreover, in applying Magill, a realistic approach to market power in secondary markets is required.

Contents
Introduction 
The Magill Cases 
Magill and the Software Directive 
1. Interface information 
(i) decompilation inconvenient 
(ii) Article 6 conditions not fulfilled 
(iii) Software Directive not properly implemented 
(iv) conclusions on interface information 
2. Maintenance 
3. User interfaces 
Conclusion 
Bibliography  

Introduction
The European Court of Justice (ECJ) has finally given judgment in the Magill cases (RTE & ITP v Commission Cases C-241 & 242/91 P Judgment of 6 April 1995). The judgment will have a profound impact on the approach to the interface between intellectual property and competition (or antitrust) law. One important question is how competition law will work in conjunction with the developing body of Community legislation on intellectual property. This article looks at how the Magill judgment fits in with the Software Directive (Council Directive 91/250 on the legal protection of computer programs (OJ 1991 L122/42)) by analysing how each applies to typical situations in which copyright in a computer program might be relied on to prevent the creation of a new product or service. We will see that there are a number of issues which need to be resolved. 

Although the situations discussed in the article involve distinct technical issues, there are wider lessons to be drawn for other Community legislation on intellectual property (both existing and proposed) as well as generally for the control which EC law can exercise over proprietary product standards. The attitude of EC law will also be significant in the context of interpreting the GATT Agreement on the Trade-Related Aspects of Intellectual Property Rights (TRIPs) as well as proposed moves to harmonise competition law at the international level (see the Commission's comments on establishing a global competition policy: EC Competition Newsletter Autumn/Winter 1994 at p3).

The Magill Cases
To begin with it is worth picking out some important points from the ECJ's judgment in the Magill cases. The litigation was sparked off by a complaint by Magill TV Guide Ltd (Magill) that it had been refused access to weekly TV programme listings information which it wanted to reproduce in a comprehensive weekly guide. The TV broadcasters each held copyright in the listings for their own channel and sought to prevent reproduction by Magill. The Commission found that the broadcasters' refusal to license was an abuse of a dominant position contrary to Article 86 of the EC Treaty (Commission Decision of 21 December 1988 (OJ 1989 L78/51)). It ordered the broadcasters to supply their individual advance weekly programme listings to each other and to third parties, on request and a non-discriminatory basis, and to permit reproduction of those listings by such parties subject to payment of reasonable royalties (Article 2).

The Court of First Instance (CFI) upheld the Commission's decision (RTE, ITP & BBC v Commission Cases T-69, 70 & 76/89 [1991] ECR II-485, 535 & 575) and the ECJ has now dismissed the appeal. The ECJ held that the broadcasters each held a dominant position since they were the sole source of the information giving them "by force of circumstance" a de facto monopoly and putting them "in a position to prevent effective competition on the market in weekly television magazines" (para 47). The ECJ's finding of dominance was not based on the existence of copyright, although the ECJ did confirm its long-standing position that the mere ownership of an intellectual property right cannot confer a dominant position (para 46; for early recognition by the ECJ, see Sirena v Eda Case 40/70 [1971] ECR 69 para 16). Clearly, the ECJ recognises that it is important to assess whether there are any substitutes to be taken into account in defining the relevant market.

In reaching a finding of abuse, the ECJ relied on three characteristics of the Magill cases: first, there was a "specific, constant and regular potential demand on the part of consumers" for a new product, namely, a comprehensive weekly guide; secondly, there was no justification for the refusal to provide the information; thirdly, the broadcasters reserved to themselves the secondary market for guides by denying access to the raw material. There are obvious links between the definition of dominance and abuse. Both findings are based on the definition of a secondary market from which competition is excluded. 

There are a number of points which can be made at the outset. First, the Magill cases concern both access to and use of information. The dominant position arose from the fact that the broadcasters were the sole source of information. The refusal to allow access to and reproduction of the information was the basis for the finding of abuse. Secondly, each broadcaster entirely excluded competition in the narrowly defined market for weekly magazines for their own channel. Thirdly, Magill was attempting to market a new product which would include programme information from all broadcasters as well as commentary and pictures created or obtained independently. Finally, the new product would compete with the broadcasters' own magazines. This factor had led the Advocate General Gulmann to conclude that no compulsory licence should have been granted (Opinion of 1 June 1994 para 96). 

One issue which has exercised the attention of commentators on the Magill cases is how to apply the various concepts which the ECJ has traditionally used to justify its decisions on the application of EC law to intellectual property (see, for example, Vinje 1992, p398). In particular, the ECJ has on numerous occasions referred to the distinction between the existence of an intellectual property right and its exercise (Consten & Grundig v Commission Cases 56 & 58/64 [1966] ECR 299). The former escapes the application of EC law whilst the latter can be caught. In applying this distinction, the ECJ has taken into account the specific subject matter of intellectual property which, in the case of copyright, would include the exclusive right to reproduce the protected work ( CFI in RTE v Commission Case T-60/89 [1991] ECR II-485 para 70). The ECJ has also referred to the essential function of an intellectual property right which, in the case of copyright, is to protect the moral rights in the work and ensure a reward for the creative effort (Warner Bros v Christiansen Case 158/86 [1988] ECR 2605 para 15). The Advocate General's opinion contains a very useful analysis of these concepts but it is significant that the ECJ did not feel the need to deal with the concepts in any detail. What the ECJ did say is that a refusal to license will only amount to an abuse "in exceptional circumstances" (para 50). However, the ECJ clearly approves of the CFI's view that competition law can catch the exercise of a right which forms part of the specific subject matter of an intellectual property right. What is not clear is how the concept of essential function fits into this analysis: the Advocate General thought the essential function could not be undermined by Article 86 (para 84); the CFI thought that the essential function was qualified by the need to respect the aims of Article 86: RTE v Commission Case T-60/89 [1991] ECR II-485 para 71). The absence of a statement by the ECJ of a role for the essential function reflects the lack of a theoretical basis for the intervention of competition law. On the other hand, this would not matter in practice provided the circumstances in which a compulsory licence can be granted under Article 86 were clear. We will see that this is not yet the case.

Magill and the Software Directive
We can now turn to three typical situations which raise issues on the interaction of the Magill cases with the Software Directive: first, access to technical interfaces which enable a third party to create an interoperable software product; secondly, access to information and other materials by third party maintainers of software; thirdly, reproduction by a third party of an existing software user interface. These examples raise important legal issues but are also of great practical significance in the information technology industry. (For a comprehensive account of the issues raised by EC law in the IT industry, see Downing 1995a). 

Since jurisprudence on some of the issues covered in this article is well developed in the US, some references are made to US cases. Care should be taken in applying US approaches to the interpretation of the Software Directive. In the context of interpreting UK copyright law, Jacob J remarked that he did "not find the route of going via United States law particularly helpful" (Ibcos Computers v Barclays Finance [1994] FSR 275 at p302).

1. Interface information
There is a considerable body of literature on this complex topic. (For a recent comprehensive analysis, see Band & Katoh 1995). We begin with an outline of the technical background. Invariably, a computer program will need to work in conjunction with another program. For example, an applications program, such as a spreadsheet, will have to communicate with the operating system which in turn makes the hardware perform the necessary functions. Communication has to take place according to defined rules. We will see that implementation of these rules does not necessarily involve copying any material protected by copyright. However, third parties may not have ready access to the relevant information. Interface information may be made public, often to encourage third parties to create interoperable programs. If the information is not freely available, it may be possible to derive the rules by examining the target program. However, this may require the target program to be translated (or decompiled) from machine readable (object) code into human readable (source) code. 

If access to or implementation of an interface were to be restricted, there is a concern that the supplier of the target program could control the supply of compatible products. The essence of the debate is whether copyright can be used to restrict access to and use of an interface and, if so, whether competition law can provide any remedy. Thus, there are issues of intellectual property law and, possibly, issues of competition law. It is important to recognise that the factors to be considered in the interpretation of intellectual property law may be different to those relevant to the application of competition law. This follows from the different functions of those laws. Intellectual property involves a balance between promoting creativity and allowing others access to the results. Competition law is primarily concerned with the control of market power and yet the existence of market power may be simply a reflection of the existence of an intellectual property right. We will see that difficulties will arise if competition law is relied on to deal with issues which are better dealt with under intellectual property law. 

What is the position under the Software Directive? The Directive does address the issue of whether interfaces are capable of protection. Article 1(2) provides that: 

"Ideas and principles which underlie any element of a computer program, including those which underlie its interfaces, are not protected by copyright under this Directive." 

In other words, to the extent that implementation of an interface only involves copying an idea or principle, there is no breach of copyright. The Recitals to the Software Directive confirm the need to apply the principle that copyright protects expression of ideas and principles and not the ideas and principles themselves. Further, as the Commission pointed out in its Explanatory Memorandum to the original proposal: 

"If similarities in the code which implements the ideas, rules or principles occur as between interoperative programs, due to the inevitability of certain forms of expression, where the constraints of the interface are such that in the circumstances no different implementation is possible, then no copyright infringement will normally occur, because in these circumstances it is generally said that idea and expression have merged" (COM(88) 816 final of 17 March 1989 para 3.13) - the so-called "merger doctrine". 

Finally, even if implementation of an interface does involve copying of material protected by copyright, it may be that the copying is not sufficient to amount to infringement. 

At this point in time, it is difficult to predict how courts will approach the distillation of ideas and principles from protected material and the application of the merger doctrine. We might be able to learn from US experience. In a famous case, in 1987, one US Court of Appeal adopted a very narrow definition of the idea in a computer program so expanding the scope of copyright protection (Whelan v Jaslow [1987] FSR 1). More recent cases have rejected this approach and narrowed copyright protection (see Computer Associates v Altai 982 F2d 693 (2nd Circuit, 1992)). Unfortunately, it is precisely on the meaning of ideas in this context that an English court found reference to US law to be unhelpful. It is to be hoped that comparative analysis will be more acceptable to other judges in Member State courts, although, even in the US, there are still concerns that the balance is not yet properly struck (see, for example, Stern 1995, p173). At this stage, we certainly cannot exclude the possibility that implementation of an interface will infringe copyright. On English law, for example, see Sherwood-Edwards (1993, p173); for an example from the US, see Atari Games v Nintendo 975 F2d 832 (Federal Circuit, 1992).

What about access to interface information? The starting point is that decompilation to obtain information will probably constitute translation for the purposes of Article 4(b) and so infringe the copyright owner's exclusive rights. However, Article 6 provides an important exception. It permits "reproduction of the code and translation of its form within the meaning of Article 4(a) and (b)". This would include decompilation. There are a number of qualifications which include, first, that decompilation is "confined to those parts of the original program which are necessary to achieve interoperability" (Article 6(1)(c)). Interoperability is defined in the Recitals as "the ability to exchange information and mutually use the information which has been obtained". Secondly, those permitted to decompile are restricted to persons having the right to use the original program or a third party authorised by them (Article 6(1)(a)). Thirdly, the information necessary to achieve interoperability must not have previously been made been readily available to those permitted to decompile (Article 6(1)(b)). It is not clear whether payment can be demanded for provision of information: Czarnota & Hart (1991, p80) conclude that a payment can be demanded; Dreier (1991, p324) seems to conclude that no payment can be demanded. Finally, and crucially, use of the information is not permitted for "the development, production or marketing of a computer program substantially similar in its expression, or for any other act which infringes copyright" (Article 6(2)(c)). This proviso does not stop the creation of competing products. Rather, it stops the taking of copyright material. It follows that the impact of Article 6 will depend to a large extent on how the courts resolve questions over the extent to which interfaces are protected by copyright under the Software Directive. 

What is the impact of Magill on access to and use of interface information? At first sight Magill certainly seems to be analogous. Those cases involved information created as a by-product of another product (television broadcasting) the sole of source of which information refused to allow third party access and use. Moreover, there are situations in which Article 86 might present a better option than Article 6 of the Directive to someone seeking to create an interoperable program. Three such situations will be looked at: first, where, even though there is a right to decompile under the Software Directive, decompilation is expensive or inconvenient; secondly, where the conditions laid down in Article 6 are not fulfilled; and, thirdly, where the Software Directive has not been properly implemented.

(i) decompilation inconvenient
What about the case where it is expensive or inconvenient to obtain the information through the process of decompilation? Not only is decompilation costly, it is also time-consuming and, if nothing else, may give the supplier of the target program a substantial lead-time over those seeking to market competing products. Can Article 86 be invoked in these circumstances to obtain the information directly from the supplier of the target program? It could be argued that the Software Directive preempts the application of Article 86. In fact, since secondary legislation cannot override the Treaty, the better view is that the Directive does not stop the application of Article 86. The Recitals clarify that: "... the provisions of this Directive are without prejudice to the application of competition rules under Articles 85 and 86 of the Treaty if a dominant supplier refuses to make information available which is necessary for interoperability as defined in this Directive".

There may be an argument that Article 6(3) of the Directive has an impact on the application of Article 86. Article 6(3) prohibits Article 6 to be interpreted "in such a way as to allow its application to be used in a manner which unreasonably prejudices the right holder's legitimate interests or conflicts with a normal exploitation of the computer program". The wording comes from Article 9(2) of the Berne Convention for the Protection of Literary and Artistic Works. Its inclusion in the Software Directive has been described as "a draftman's nightmare which ought to have been left in the field of dreams" (Cornish 1993, p199)), but does it affect the application of Article 86? An argument was put forward in Magill that a compulsory licence under Article 86 would contravene the Berne Convention. The ECJ side-stepped the issue by deciding that the Berne Convention did not override EC law as between Member States (para 84). The issue could crop up in the context of the Software Directive because of Article 6(3). On the other hand, the Advocate General concluded that Article 86 did indeed satisfy the requirements of the Berne Convention (para 166), although on the basis of a narrower role for Article 86. It may well be that the ECJ would take a similar approach and find that Article 86 is consistent with the Berne Convention. 

In what circumstances could Article 86 be applicable? In Magill, the ECJ states that, if a supplier is the sole source of information, the resultant de facto monopoly may amount to a dominant position if it gives the power to exclude others from the market. There may be an argument that the ability to obtain the information under Article 6 of the Directive does amount to a second source. Otherwise, dominance will depend on the definition of the relevant market. Both the ECJ and the Commission have shown willingness to define narrow markets for products which are supplied subsequently to work with a primary product. The classic example is spare parts. In Hugin v Commission (Case 22/78 [1978] ECR 1869), the ECJ upheld a finding of dominance in the supply of spare parts despite the fact that Hugin held a small share of the market for the primary product. In the case of interface information, this could mean that there may well be a dominant position on the market for interoperable software, even though the market share for the target software is small. There are arguments that the Commission and the ECJ should take greater account of competition from the primary product market since suppliers are frequently constrained in the price they can charge for secondary products by competition for the principal product (see Downing 1995b). The assessment of competition in secondary markets is a key issue in the IT industry (see, generally, Downing 1995a). 

On the question of abuse, although Magill concerns copyright information, a similar approach can be expected in the case of access to information which is not protected by copyright. Again, though, we come back to the availability of the decompilation right because, the owner of rights in a target program, unlike the broadcasters in Magill, is denied the power to exclude competition in the downstream market by Article 6 of the Directive. In other words, unlike Magill, the owner of rights in the target program cannot reserve to itself a secondary market. The problem case would be where decompilation is so costly that there is effective control over the market for compatible products. How do we apply the other characteristics of abuse identified in Magill? If the supplier of software has excluded competition, the key question is how we apply the test for a new product for which there is a potential consumer demand. It is important to bear in mind that Magill permits access to information for the creation of a competing product. What is not clear is how new the product must be for a compulsory licence to be available. Presumably, it is not enough that the new product is cheaper. But is it enough that the new product has more features? Is more up to date? Or is it enough that it is simply different? Indeed, could it be argued that, since the new product does not infringe copyright (otherwise the decompilation right is not available), it is by definition a new product? We should bear in mind, though, that the new magazine in Magill was substantially different from the existing magazines and that the ECJ did say that a refusal to license will only amount to an abuse in exceptional circumstances. The difficulty is that, once we concede the principle that competing products cannot be stopped, it is difficult to draw the line on intervention. Even a narrow view of the Magill judgment surely turns Article 86 into a powerful potential weapon in this field. 

We should not forget that the ECJ did leave open the possibility of justification of a refusal to license. Justification is a part of the ECJ's jurisprudence on Article 86 even if invariably referred to in rejecting arguments that particular behaviour is objectively justified (see, for example, the CFI in Hilti v Commission Case T-30/89 [1992] ECR II-1439 paras 115-119). In the absence of anything other than the simple assertion that there was no justification on the facts in Magill, it is difficult to know what the ECJ had in mind. The ECJ does refer to the following paragraph from the CFI's judgment in ITP v Commission:

"The [broadcaster's] refusal to authorise third parties to publish its weekly listings was, in this case, arbitrary in so far as it was not justified by the requirements peculiar to the activity of publishing television magazines. It was thus possible for the [broadcaster] to adapt to the conditions of a television magazine market which was open to competition in order to ensure the commercial viability of its weekly publication ..." (para 58).

It is difficult to see what this adds to the analysis of abuse - is the test for justification really based on whether the copyright owner can compete successfully with the third party product? 

If the decompilation right cannot be relied on because information is made available, could there be a difference in payments which can be demanded pursuant to Article 6 of the Directive and Article 86? The Commission's decision in the Magill cases did permit a reasonable royalty to be charged. This sort of order might be limited to copyright protected material, although it is worth noting that the Commission did permit IBM to charge for the cost of providing information in the settlement of its dispute with the Commission on the issue of interface information (paras 4 and 7 of Appendix B to IBM's undertaking [1984] 3 CMLR 147 at p161). As we have seen, it is not clear how this issue is to be resolved under Article 6. Czarnota & Hart (1991, p80) conclude that payment under Article 6 should be judged "in competition terms" which would suggest that payments under Articles 6 and 86 would be the same.

(ii) Article 6 conditions not fulfilled
Perhaps the more difficult case is where the decompilation right is not available. One example would be where implementation of the interface does involve copying material protected by copyright. Unlike Article 6, Magill could indeed give the power to grant a compulsory licence of such copyright material. Is there a stronger argument here that the Software Directive preempts the application of Article 86 because it would go further than Article 6 of the Directive? The ECJ does begin its analysis of abuse in the Magill judgment by noting that "in the absence of standardisation or harmonisation of laws, determination of the conditions and procedures for granting protection of an intellectual property right is a matter for national rules" (para 49). Again, though, the Software Directive is only secondary legislation. Moreover, why should the ECJ say that Article 86 is not available? The key point is that Article 86 is based on a different trigger to a qualification contained in a directive. In other words, Article 86 does not control the scope of an intellectual property right but only its exercise by a firm which holds a dominant position where that exercise amounts (exceptionally) to an abuse. We should bear in mind that the ECJ in Magill rejected the argument that qualifying intellectual property rights fell within the exclusive jurisdiction of the legislature. The potential impact of Article 86 on the application of the Software Directive is just a reflection of the significance of Magill for national intellectual property rights.

If Article 86 is available as a remedy, in what circumstances would it apply? So far as dominance is concerned, it may well be that the owner of rights in the target program is the sole source of the interface information. Although there is still an argument that the information can be obtained by decompilation under Article 6 of the Directive, in this case, the owner can rely on copyright to prevent the use of this information affecting its market. The question of dominance would then turn on the definition of the market. As we have seen, both the Commission and the ECJ are willing to ignore competition from the primary market which serves to limit the scope of markets in interoperable secondary products. We then need to turn to the characteristics identified by the ECJ in Magill as supporting a finding of abuse. We have the same difficulties already discussed in interpreting what the ECJ means by a new product and justification.

Another case where the decompilation right may not be available is where the supplier of the target program relies on the law of confidence to stop the use of interface information. Where the software has been released to the market, it may well be that there is no possibility of arguing that the interface information is confidential (cf Sega v Accolade 977 F2d 1510 (9th Circuit, 1992) at p1526 n9). But what about the case where a third party is provided with a pre-release version? In a US recent case, Stac was found to have illegally used Microsoft's trade secrets when it used interface information derived from pre-release software (see Vinje (1994)). The first point is that any contractual restriction on decompilation will not survive Article 9(1) which provides that any contractual provision contrary to Article 6 "shall be null and void". However, Article 9(1) also states that the Directive is "without prejudice to any other legal provisions such as those concerning ... trade secrets ...". If a court were to prohibit reliance on Article 6 where interface information was confidential, could Article 86 be relied on instead? Apart from the questions on the application of Article 86 already discussed, there may be an argument here that the confidentiality of the information justifies a refusal to license. On the other hand, the IBM settlement certainly envisages the disclosure of confidential information (see para 2 of Appendix B to the Undertaking: [1984] 3 CMLR 147 at p160). 

(iii) Software Directive not properly implemented
We have looked at the case where the decompilation right is not available or is inconvenient. What if the Software Directive is not properly implemented by a Member State in national law? There is of course the possibility of Commission proceedings against the Member State under Article 169 of the EC Treaty but is it possible to rely in a national court on the Directive itself? The ECJ has held that a national court must seek to interpret national legislation in conformity with a directive (Case C-106/89 Marleasing v La Comercial Internacional de Alimentaci—n [1990] ECR I-4135). Even where this is not feasible, a directive can, in certain circumstances, be applied directly in a national court. However, the ECJ has refused to go as far as allowing direct effect between private parties and only allows direct effect as against emanations of the State (Case C-91/92 Paola Faccini Dori v Recreb Judgment of 14 July 1994). If the national court does not apply the Software Directive, there may be a claim for damages against the Member State under the principles laid down in the Francovich case (Cases C-6 & 9/90 Francovich v Italy [1991] ECR I-5357). Moreover, in principle, subject to findings of dominance and abuse, there seems no reason why Article 86 could not be invoked.

(iv) conclusions on interface information
In conclusion, in principle, the Magill cases do establish a powerful potential additional right to the Software Directive provided the ECJ does not find a way to conclude that the operation of Article 86 is in some way preempted. The importance of Magill will depend on a number of factors. First, the narrower the scope given to the copyright protection of interfaces, the broader the scope of Article 6 of the Directive. Secondly, definition of dominance will be crucial. It was pointed out above that the ECJ and the Commission seem easily to find dominance in a downstream market. Taking into account competition for the principal product may be the change of approach needed to preempt excessive reliance on the Magill judgment. Thirdly, much will depend on the approach to the characteristics of the Magill cases which led to a finding of abuse. The difficulty in applying this aspect of Magill probably just reflects the absence of any theoretical analysis in the Magill judgment of the basis on which competition law should be available for the grant of a compulsory licence. Finally, in practice, much will depend on the willingness of the Commission to rely on Magill as well as the approach of national courts to the direct application of Article 86. Past experience suggests a reluctance on the part of national courts to do so, at least in the UK (see, for example, IBM v Phoenix [1994] RPC 251).

2. Maintenance
Software suppliers, like suppliers of many other products, may seek to profit from services required by the licensee. Software may need to be corrected, updated or altered for use on different hardware. Competition for these services may depend on the third party maintainer having access to information and other materials. It may be possible to derive this information from examining and decompiling the software. It may be that other information has to be obtained from the software supplier. It may be the case that the software can only be analysed with diagnostic programs developed and owned by the supplier of the original software (for an example from the US, see Data General v Grumman 36 F3d 1147 (1st Circuit, 1994)).

How does the Software Directive deal with these issues? There is one provision which may assist. Article 5(1) permits (amongst other restricted acts) reproduction and translation where "necessary for the use of the computer program by the lawful acquirer in accordance with its intended purpose, including for error correction." This may give the right to decompile but there are a number of reasons why it may not be sufficient for third party maintainers. First, this right applies "in the absence of specific contractual provisions" although there seems to be a conflict here with the Recitals. Secondly, Article 5(1) would not permit reproduction or translation by a third party maintainer unless it was itself a lawful acquirer (for an example of the practical importance of who has the right, see the US case of MAI Systems v Peak 991 F2d 511 (9th Circuit, 1993)). Thirdly, the right only extends to error correction which is only one function which a third party maintainer might seek to perform. Finally, it is clear that the Software Directive gives no right to obtain access to diagnostic programs. 

Given the limited scope of the Software Directive, could Article 86 be relied on to obtain information and other materials for the purposes of third party maintenance? If the Software Directive does not preempt the application of Article 86 in the situations already looked at, it is difficult to see why the position should be any different in the case of third party maintainers. If so, the third party maintainer's position will depend on whether refusal to allow access to and use of materials could be caught by Article 86. It may well be that the supplier of the software is the sole source of the relevant information and other materials so again a finding of dominance may well depend on the definition of the market. As we have seen, the Hugin case supports a narrow definition of downstream markets even in the absence of market power in the market for the principal product. If the supplier of software refuses to allow access to information and other materials so as to reserve the maintenance market to itself, there is an argument for dominance. How do the characteristics of abuse identified in the Magill judgment apply in this case? Once again the key question is the extent to which the "services" offered by the third party maintainer could be argued to be a "new product". It may well be more difficult to identify differences in the services being performed by a third party maintainer sufficient to satisfy this test. There may also be arguments here on justification, in particular, if information is confidential. 

3. User interfaces
The software user interface is that part of the software which the user sees and interacts with. Although there may be no great creativity involved in the design of a user interface, if a software product is successful, purchasers may well be reluctant to change to a different interface. Unless competitors can copy the user interface, their products may be under a significant disadvantage. There are good examples of the problem in recent litigation in the US. In Lotus v Borland (49 F3d 807 (1st Circuit, 1995)), for example, Lotus sought to prevent Borland from including in its spreadsheet software a facility to emulate the user interface of the popular Lotus 1-2-3 product. 

The Software Directive contains no provision dealing specifically with user interfaces. It will be for the courts to decide whether a user interface is protected by copyright in accordance with the Directive. One provision which is relevant is the exclusion of protection of ideas and principles under Article 1(2). The courts ought to take some lessons from the US. The Lotus v Borland decision of the Court of Appeals for the First Circuit suggests that the courts in the US are moving towards limited protection for user interfaces. However, that court  relied on the exclusion from copyright protection of "methods of operation" (§102(b) US Copyright Act). There is no such exclusion in the Software Directive and, as we have seen, it may be that Member State courts will reject straightforward application of the principles of US law. 

If Member State courts do hold that a user interface is protected by copyright, could a compulsory licence be sought under Article 86 as interpreted in Magill? Although the user interface could be considered to be raw material for which the sole source is the owner of copyright, the key difference to the situations already discussed is that a supplier relying on copyright over a user interface is less likely to be able to exclude competition in the market. In this case, the copyright is not used to exclude all competition from a downstream market such as an interoperable program. Rather it makes it more difficult for competitors to achieve success in the market for the principal product. This makes it much less likely that the owner of copyright over a user interface will be held to be dominant and for there to be a finding of abuse. If the success of the user interface does indeed create a substantial barrier to entry, again, the question will arise as to what we mean by a new product. Similar considerations will apply as those discussed in relation to interface information.

Conclusion
The overall conclusion from this discussion is that, through its judgment in Magill, the ECJ has established a powerful instrument in Article 86, in particular, in the case where the material required for the third party product is protected by copyright. In this light, we have to ask whether the ECJ should have allowed Article 86 ever to be relied on for the grant of a compulsory licence of intellectual property. The main issue in the case of interfaces (both technical and user) is the scope of copyright protection. Balancing the rights of the creator of a program against society's interest in the use by others is the best way of dealing with the issue and this is the function of copyright. There are strong arguments that Article 86 does not provide an adequate basis for dealing with this issue focused as it is on the question of market power. It is worth noting that the Commission's attitude in the Magill cases was based on its hostility towards the protection by copyright of programme listings. Does this mean that Article 86 is being set up to control the balance carried out by intellectual property? This is not a function for which it is well equipped. Properly interpreting the Software Directive should be the main focus of a court's enquiry. What we need is a restrictive notion of ideas and principles in the context of computer programs. The issues have been addressed squarely in the US and it is to be hoped that courts in the Community do learn from those cases. If Article 86 is to be invoked, the key constraint on the application of Magill should be a more realistic definition of dominance which takes into account competition in the market for the primary product. 

There are wider lessons to be drawn from the analysis of Article 86 and the Software Directive. For one, the issues will also arise in the context of other Community legislation on intellectual property, for example, the proposed Database Directive (Amended Proposal for a Council Directive on the legal protection of databases (OJ 1993 C308/1) on which the Council adopted a common position in June 1995). 

There is much discussion at the moment over the extent to which Article 86 can be used to permit access to proprietary standards. Where the standards are necessary for interoperability, Article 86 can now clearly be relied on to force the standards to be shared. Again, much will depend on the definition of the market. The Commission has shown readiness to define markets in the IT industry according to interoperability standards (see, for example, AT&T/NCR Case IV/M050 (OJ 1991 C16/20)).

A further wider issue is the international situation. The Commission competition directorate is focusing its attention on international agreement on the application of competition law but the Magill approach may not appeal to the wider international community. There is now widespread international agreement on intellectual property in TRIPs, in particular, requiring compliance with the Berne Convention (Article 9). We have seen that the ECJ in Magill side-stepped the question whether a compulsory licence under Article 86 is consistent with Article 9(2) of the Berne Convention. The issue will have to addressed squarely at some point.

There is a good deal of uncertainty over the application of Magill, but there is no doubt that we can expect a significant amount of litigation before the issues are resolved.

Bibliography

Band & Katoh (1995) Interfaces on Trial (Oxford: Westview Press).

Cornish (1993) in Lehman & Tapper (eds) A Handbook of European Software Law (Oxford: Clarendon Press) p183.

Czarnota & Hart (1991) Legal Protection of Computer Programs in Europe - A Guide to the EC Directive (London: Butterworths).

Downing (1995a) EC Information Technology Law (Chichester: Chancery Law).

Downing (1995b) 'Hilti: The Final Nail' 16 European Competition Law Review 53.

Dreier (1991) 'The Council Directive of 14 May 1991 on the Legal Protection of Computer Programs' 13 European Intellectual Property Review 319.

Sherwood-Edwards (1993) 'Seven Degrees of Separation: the Software Directive and UK Implementation' 9 Computer Law & Practice 169.

Stern (1994) 'Reverse Engineering for Future Compatibility' 16 European Intellectual Property Review 175.

Vinje (1994) 'Threat to Reverse Engineering Practices Overstated' 16 European Intellectual Property Review 364.

Vinje (1992) 'Magill: Its Impact on the Information Technology Industry' 14 European Intellectual Property Review 397.