Part II Preparation and vendor selection
Chapter 11: The contract: who will own the software
Software you have paid for does not have to be yours. When a company delivers it, the prevailing interpretation is that you need an explicit license; otherwise, you may only use it and may not have another vendor modify it. The contract should also cover continuous code handover, access to data, an exit plan with a price, and rules for code from AI.
This chapter is not legal advice. It describes the situation as of October 2026 and the prevailing interpretation, which the courts have not yet clearly confirmed. Always have a lawyer review the development contract and the license terms.
The author is always a person; you get a license
Only a natural person can be the author of a program, and they cannot transfer their copyright Act No. 121/2000 Coll.. A company or a customer can exercise the economic rights or obtain a license to use the work. So do not write “transfer of ownership” in the contract; write a license and its scope. Anglo-American templates such as “work made for hire” may not work under Czech law.
What is protected is the code, not the idea, the algorithm, or the functionality (Section 65 of the Czech Copyright Act). What matters, then, is what you are allowed to do with the specific code.
The § 58(7) trap: a freelancer yes, a company no
The law says that a program created to order is considered an employee work, and the customer is considered the employer. That sounds as if the customer automatically exercises the rights. But according to the prevailing interpretation in legal literature, this only applies if you conclude the contract directly with the author, that is, with a natural person epravo.cz, 2009. When a company delivers, it exercises the rights, and you need a license or an assignment of the exercise of economic rights.
No case law of the Supreme Court that would settle the question has been found. So do not rely on the interpretation, even with a freelancer, and always agree on a license.
Custom development is usually agreed in a contract for work (smlouva o dílo). On its own, however, it does not give you the right to modifications: without an explicit license, the vendor is deemed to have provided the work for the purpose that follows from the contract § 2634, Civil Code. So you may use the system, but not have another company modify it. This is where most vendor dependency begins (chapter 24).
A license is not ownership
Paying for development does not by itself make you the owner of the copyright. The text of the license decides: scope, the right to modify, sublicensing, and assignment. A “license to use for your own needs” means that every change must be made by the original vendor at its own price. So never sign license terms without a lawyer’s review.
How broad the license should be
The license should be:
- exclusive, unlimited in territory and time, for all forms of use, even after the contract ends,
- with the right to modify and combine with other works, including through another company,
- with the right to sublicense and assign, for example to another vendor for further development,
- paid for in the contract price, with a statement by the vendor that it has secured the necessary rights from all authors and subcontractors.
An exclusive license usually covers only the parts created for you. For the vendor’s earlier components and third-party parts, you get a non-exclusive license; have a lawyer define the scope of both. Red flag: “the license is governed by our terms and conditions” or “we’ll sort out the license later.” You will find the full list in the checklist at the end of the chapter.
Code, documentation, and data continuously, not at the end
Ask for the code with build scripts and documentation in your repository after every sprint. The test is simple: can another company build, deploy, and change the system from what was delivered? Include documentation in the acceptance conditions. Without it, a delivery is not ready to be invoiced.
Source code escrow suits parts whose code you do not receive directly, typically the vendor’s own components. The code is released upon events defined in the contract, such as insolvency, cessation of business, or long-term non-performance. Deposited code without a license to modify it and without documentation tends to be outdated and unusable.
Ask for free access to the data at any time, in an open and machine-readable format. The Supreme Audit Office (NKÚ) showed the consequences of the opposite approach: a ministry would have had to pay the vendor for its own data from its own system NKÚ, audit conclusion KZ 17/24 (more in chapter 24). The EU Data Act will not protect you with a custom system: its rules on switching providers target cloud services, and some obligations do not apply to services custom-built for a single customer (Article 31).
Agree on the exit plan, acceptance, and penalties at signing
The best time to negotiate a breakup is while you are still in love. The exit plan sets out how the vendor will help hand the system over to a successor, how long parallel running will last, how the data will be migrated, and what the price and deadlines will be. Regulated entities under the Cybersecurity Act are required to have an exit strategy in their contract with a significant supplier Decree No. 409/2025 Coll..
Agree on acceptance in stages, fixed deadlines for both parties, and a classification of defects. Set penalties proportionately and with a cap; a court can reduce a disproportionate penalty (Section 2051 of the Civil Code). Also define your own obligations in the collaboration. If you do not meet them on time, the vendor’s deadline may move too. A one-sided contract does not pay off: the Office for the Protection of Competition (ÚOHS) canceled the tender for the digitalization of building permits partly because of missing acceptance deadlines ÚOHS, S0321/2023(chapter 12).
Code from AI and open-source components
The Municipal Court in Prague stated that an image created by AI is not a copyrighted work, because it is not the result of a person’s creative activity Prague Municipal Court, 10 C 13/2023. The case concerned graphics and the reasoning of a first-instance court. But similar arguments may also apply to code: purely generated code may not be protected, and you have no exclusivity over it. Code that a person creatively modifies can be protected.
So the contract should include rules for AI and an inventory of all components and their licenses (SBOM). Check especially for copyleft (“viral”) licenses, which could oblige you to publish your own code as well.
| How it goes wrong | How to do it right |
|---|---|
| How it goes wrongA contract for work with an IT company without license terms. | How to do it rightAn explicit exclusive license with the right to modify, sublicense, and assign. |
| How it goes wrong“A license to use for your own needs.” | How to do it rightA license for all forms of use, unlimited in territory and time, even after the contract ends. |
| How it goes wrongYou get the code “when the contract ends.” | How to do it rightCode in your repository after every sprint, verifiably buildable. |
| How it goes wrongData export for an extra fee. | How to do it rightFree access to the data in an open format at any time. |
| How it goes wrongThe exit is dealt with only when you are parting ways. | How to do it rightAn exit plan with a price, deadlines, and a transitional period is an annex to the contract. |
| How it goes wrongNothing about AI in the contract. | How to do it rightA statement on the use of AI, human review, liability for third-party rights, SBOM. |
- For custom software, requiring the code and an exclusive license is standard. But the requirement must be proportionate: for off-the-shelf software, courts have rejected a blanket requirement for source code epravo.cz, 2026.
- You must publish the code created in the project to the extent that it cannot be misused to compromise the system (Section 18(2)(c) of Decree No. 360/2023 Coll., from July 1, 2024) Decree No. 360/2023 Coll.. According to the Digital and Information Agency (DIA), custom software should be open source if its nature allows DIA, Vendor lock-in methodology. Both assume that you have the code and the rights.
- The contract is part of the tender documentation, and later changes are subject to Section 222 of the Public Procurement Act (ZZVZ); see chapter 18. Put the reservation for a change of vendor into the tender documentation (Section 100).
- Contracts over CZK 50,000 excluding VAT belong in the Register of Contracts. They take effect at the earliest upon publication, and an unpublished contract is canceled from the outset after 3 months Act No. 340/2015 Coll.. You must enforce contractual penalties.
- Source code escrow does not solve dependency. If you could have obtained the code and the rights at a reasonable price and did not, the courts will hold the vendor’s exclusivity against you (chapter 12).