In the era of digital transformation, software has gradually become a critical factor in business development and daily operations. Along with such improvement, disputes concerning software maintenance obligations have increased significantly. In the article below, NPLaw analyzes the current situation, concepts, causes, resolution methods, and legal regulations related to such disputes.
I. Current situation of disputes concerning software maintenance obligations
In the context of rapid digitalization, the demand for deploying and operating software within enterprises is increasing steadily. It has made software maintenance aimed at ensuring adaptability and alignment with development needs.
However, in practice, disputes concerning software maintenance obligations are becoming increasingly common for the following reasons:
- Software contracts do not clearly define the scope of maintenance.
- Service providers delay or refuse maintenance due to cost considerations, user-related errors, or project overload.
- Clients demand support beyond the initial contractual commitments.
- Disagreements arise regarding maintenance timeframes or quality.
Disputes over software maintenance obligations not only affect the material interests of the parties but also disrupt production and business operations, and may even damage corporate reputation.
II. Understanding disputes concerning software maintenance obligations?
1. What is a dispute concerning software maintenance obligations?
Current laws do not provide a specific definition of “a dispute concerning software maintenance obligations”. However, based on relevant provisions of the Law on Intellectual Property 2005, as amended and supplemented in 2009, 2019, and 2022, and the Law on Information Technology 2006, it may be understood as follows:
-
A dispute concerning software maintenance obligations refers to conflicts or disagreements between the software provider and the software user regarding the execution of obligations to fix errors, upgrade, apply security patches, or maintain the stable operation of the software in accordance with contractual agreements.
Accordingly, software is understood as a collection of instructions expressed in the form of commands, codes, schemes, or other forms that are integrated into a medium or device operated by a computer programming language are capable of enabling a computer or device to perform tasks or achieve specific results (Clause 1, Article 22 of the Law on Intellectual Property 2005, as amended and supplemented by Clause 6, Article 1 of the Law on Intellectual Property 2022).
A clear understanding of disputes concerning software maintenance obligations forms the basis for the accurate application of relevant legal provisions.
2. Common situations leading to disputes concerning software maintenance obligations
In practice, common situations leading to disputes concerning software maintenance obligations include:
- Errors arising from user actions, such as improper use, unauthorized intervention in source code, etc.
- Software malfunctions with unclear causes.
- Delays or refusals by the provider in executing maintenance obligations.
- Failure by the user to fully pay maintenance fees.
- Maintenance requests exceeding the contractual scope (e.g., requests for new feature upgrades instead of error fixes).
The above are typical situations leading to disputes over software maintenance obligations. Depending on the specific case, additional causes may also arise.
3. Methods for resolving disputes concerning software maintenance obligations
When disputes concerning software maintenance obligations arise, organizations and individuals are primarily concerned with resolution methods that minimize adverse impacts on their interests.
Pursuant to Clause 2, Article 75 of the Law on Information Technology 2006 and Article 317 of the Law on Commerce 2005, there are currently four methods for resolving disputes concerning software maintenance obligations:
- Negotiation: The parties independently agree on a dispute resolution solution without the involvement of a third party.
- Mediation: A dispute resolution method involving a third party acting as a mediator.
- Arbitration: The parties agree to submit the dispute to arbitration.
- Court proceedings: Dispute resolution conducted through judicial procedures by competent courts.
Each resolution method has its own advantages and disadvantages. Therefore, the choice of dispute resolution method depends entirely on the contractual parties.
III. Legal regulations related to disputes concerning software maintenance obligations
Software plays a core role in business development in the context of Industry 4.0. Accordingly, disputes concerning software maintenance obligations affect not only corporate interests but also broader social operations.
Therefore, the law has stipulated various regulations governing disputes concerning software maintenance obligations to mitigate such situations.
1. Relevant regulations for resolving disputes concerning software maintenance obligations
Software is considered an object of intellectual property rights, and maintenance is typically governed by service contracts or technology product supply contracts.
As a result, legal provisions related to resolving disputes concerning software maintenance obligations are scattered across multiple legal documents, notably including:
- Civil Code 2015: Article 428 governs unilateral termination of contracts, including software maintenance contracts; Article 449 regulates compensation for damages during warranty periods.
- Law on Commerce 2005: Article 40 provides for liability for goods not conforming to contracts (in cases of software not conforming to contractual agreements); Article 317 regulates dispute resolution methods.
- Law on Information Technology 2006: Article 47 regulates types of information technology industries, including software maintenance; Article 75 governs the resolution of information technology disputes.
These are the main legal grounds that readers may consult when resolving disputes concerning software maintenance obligations. In specific cases, parties must also comply with procedural regulations under the Civil Procedure Code 2015 or the Law on Commercial Arbitration 2010.
2. Authorities competent to resolve disputes concerning software maintenance obligations
Pursuant to Clause 2, Article 75 of the Law on Information Technology 2006 and Article 317 of the Law on Commerce 2005, the competent authority varies depending on the chosen dispute resolution method.
Accordingly, entities competent to resolve disputes concerning software maintenance obligations include:
- Contractual parties under the software maintenance contract.
- Arbitration bodies agreed upon by the parties in the contract.
- People’s Courts.
In summary, the competent authority to resolve disputes concerning software maintenance obligations depends on the selected dispute resolution method.
3. Consequences if disputes concerning software maintenance obligations cannot be resolved
Common consequences include:
- For software users: Risk of data loss due to system failures; loss of business opportunities and financial damages.
- For software maintenance service providers: Exposure to legal liabilities such as compensation for damages; risk of reputational harm.
- Prolonged disputes may also result in significant costs and time expenditures for litigation.
In short, unresolved disputes concerning software maintenance obligations adversely affect both users and service providers.
IV. Questions regarding disputes concerning software maintenance obligations
Below are common questions and corresponding answers related to disputes concerning software maintenance obligations.
1. Is refusal to provide maintenance due to payment breaches lawful in disputes concerning software maintenance obligations?
Clause 1, Article 358 of the Civil Code 2015 provides that where an obligated party fails to perform a required task, the entitled party may demand continued performance, perform the task itself or assign another to do so, and request reimbursement of reasonable costs and compensation for damages.
Additionally, Clause 1, Article 428 of the Civil Code 2015 stipulates that a party has the right to unilaterally terminate a contract without compensation if the other party commits a serious breach, if agreed by the parties, or as prescribed by law.
Accordingly, where the user fails to fulfill payment obligations, the maintenance service provider has the right to unilaterally terminate the contract and refuse maintenance.
2. For software that has expired warranty periods, how may disputes concerning software maintenance obligations be resolved?
For software beyond the warranty period, dispute resolution may be based on the following factors:
- Origin of the defect: If the software defect existed at the time of contract formation but was unknown to the buyer, the service provider remains liable regardless of whether the defect was discovered before or after the transfer of risk (Clause 2, Article 40 of the Law on Commerce 2005).
- Contractual terms: If the contract provides for maintenance after the warranty period, such provisions shall apply.
If no maintenance terms exist and defects arise after warranty expiration, dispute resolution depends on the goodwill of the parties.
3. In disputes concerning software maintenance obligations, what criteria determine the maximum response time?
Maximum response time is determined based on:
- Contractual terms.
- Severity of the defect.
- Technical capacity and scope of work of the service provider.
These criteria may be used as references when determining reasonable response times.
4. How does unauthorized modification of software by customers affect disputes concerning software maintenance obligations?
Pursuant to Clause 2, Article 449 of the Civil Code 2015, the seller is not liable for damages if it proves that the damage resulted from the buyer’s fault. Compensation may be reduced if the buyer failed to apply necessary measures to prevent or mitigate damages.
Accordingly, if unauthorized software modification by the customer aggravates defects, the service provider is not liable for damages attributable to the user’s fault.
5. Can indirect damages be claimed in disputes concerning software maintenance obligations?
Clause 2, Article 302 of the Law on Commerce 2005 provides that compensable damages include:
- Actual and direct losses suffered by the injured party.
- Direct profits that the injured party would have earned absent the breach.
Thus, in disputes concerning software maintenance obligations, the injured party may claim not only direct losses but also indirect damages in the form of lost profits.
V. Are you looking for a reputable lawyer to resolve disputes concerning software maintenance obligations?
Disputes concerning software maintenance obligations are complex and require a combination of technical and legal expertise. To protect their interests, many organizations and individuals choose to seek professional legal services.
With many years of experience in legal practice in general and in resolving disputes concerning software maintenance obligations in particular, NPLaw is a trusted legal partner for organizations and individuals.
The above information is for reference purposes only. For detailed advice tailored to specific cases, please contact NPLaw Law Firm for immediate consultation.
