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The Uniform Computer Information Transactions Act is a commercial code that aims to develop uniform legal rules for software licenses and other computer information transactions in all 50 states. HISTORY Ten years ago, the American Bar Association asked the National Conference of Commissioners on Uniform State Laws to amend the Uniform Commercial Code – the commercial law governing the sale of goods and services throughout the country – to write legislation clarifying the rules for software contracts. The legislation was intended to become a part of the Uniform Commercial Code, but because the American Law Institute did not support the language of the bill, it could not be introduced in state legislatures as an amendment. Instead, it had to be introduced as a separate law. The National Conference of Commissioners on Uniform State Laws decided to forge ahead on its own with the drafting process, completing and voting to endorse the bill in 1999. WHAT UCITA DOES UCITA only affects transactions involving computer information, which is defined as information in electronic form that is exchanged by computer or that can be processed by a computer. This includes everything from software to online music. The legislation establishes that computer information is different from hard goods by adapting traditional contract law, which governs material products, to computer information. For example, it makes clear that contracts can be canceled only if there has been a serious breach of the agreement – not, as is the case with traditional commercial laws, if the product doesn’t live up to so-called perfect tender rules. Most important, however, is that UCITA resolves an ambiguity in the law about whether various shrink-wrap and click-wrap agreements are valid. The general principle is that once a consumer removes the shrink-wrap packaging on a piece of software or clicks on an “I agree” box before the software’s installation, the consumer has agreed to the terms in the license agreement. STATUS UCITA was passed by Virginia and Maryland last year, but only Maryland has enacted the law. Virginia is still holding hearings on UCITA, which is scheduled to become law in July 2001. The bill will be up for review this year in Delaware, Hawaii, Illinois, Iowa, New Jersey, and Oklahoma.

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