Compliance and liability of IPRIntellectual Property ebbits is likely to produce or use may intangible assets, suchas computer programmes, literary or artistic works (e.g., images or literary descriptions), databases, valuable raw data, algorithms, industrial recipes etc.,. The Intellectual Property legal framework is thus crucial for ebbits in order to, on the one hand, secure its own investment and on the other, to avoid the infringement of Intellectual Property of others. As regards protection of valuable intangible assets generated by an ebbits system, one needs to consider traditional IP protection, such as patents and copyright. Additionally, the legal framework for the protection of business condential information and trade secrets is important. Intellectual Property rights are regulated at the internationaland national levels. The !uropean "nion (!") has adopted a number of legislative acts relating to the IP. !uropean law complies with the obligations imposed by international law, but at the same time harmonises IP# further and often provides for a higher standard of protection then international conventions,in particular in the eld of copyright. In the area of copyright protection, harmonisation at !" level is provided mostly by $ouncil %irective &''()&*)!$ of && +ay &''( on the harmonisation of certain aspects of copyright and related rights in the information society (Information ,ociety %irective), %irective '-)*-)!$ on the legal protection of databases (%atabase %irective), and %irective&''*)&.)!$ on the /egal Protection of $omputer Programs ($omputer Programmes %irective). $opyright grants an e0clusive right to control reproduction and communication to the public of literary and artistic works, as far as they are original and 0ed in some material form. In the conte0t of ebbits, the copyright may provide protection in respect of ebbits software, structure of database(s), other literary works (such as ebbits website or promotional material). 1o formalities are re2uired for copyright protection. $opyright lasts for the limited period of time (in the !", 3' years after the death of the author or from the date of rst publication). In the area of patent protection, currently there is no binding !" law on patents. Therefore the legal framework is comprised of regulation arising from both national and international laws (the most relevant act being the $ouncil of !urope !uropean Patent $onvention of (*34). The patent will protect any invention that has a technical character, providing that it is new, that it involves an inventive step and is susceptible of industrial application. The patent protection lasts for a limited period of time (&' years under the !uropean Patent $onvention). It re2uires formal lling with competent authorities. 5iling implies disclosure of information regarding the invention in 2uestion, ebbits %4.6 /egal, IP# and liability issues %ocument version7 (.' Page 3 of 33 ,ubmission date7 (- %ecember &'(4 and may involve signicant costs. $ertain sub8ect matters are e0cluded form patent protection. In !urope (under !uropean Patent $onvention) the most signicant e0clusions form patentability in the conte0t of ebbits relates to scientic theories, mathematical methods, business methods, and ordinary computer programmes. The patentability of computer9related inventions is controversial. The patent application re2uires formal lling. As far as data and knowledge ownership are concerned, patents and copyright do not provide for ownership of data or knowledge. :ence, neither patents not copyright will protect algorithms, mathematical methods, know9how, industrial recipes, or valuable raw data. ,uch assets may constitute condential information and trade secrets. ;iven the very limited harmonisation of laws on business condential information and trade secrets on the international level, and awaiting adoption of !" laws in the eld, the protection of the business condential information and trade secrets is provided by the national law of each +ember ,tate. The legal protection of trade secrets di