                                 CODE OF VIRGINIA

ELECTRONIC REGULATION OF PERFORMANCE (§ 59.1-506.5)

a. In this section, &#8220;automatic restraint&#8221; means a program, code,
device, or similar electronic or physical limitation the intended purpose of
which is to prevent use of information contrary to the contract or applicable
law.

b. A party entitled to enforce a limitation on use of information may include an
automatic restraint in the information or a copy of it and use that restraint
if:

   1. a term of the agreement authorizes use of the restraint;

   2. the restraint prevents a use that is inconsistent with the agreement;

   3. the restraint prevents use after expiration of the stated duration of the
   contract or a stated number of uses; or

   4. the restraint prevents use after the contract terminates, other than on
   expiration of a stated duration or number of uses, and the licensor gives
   reasonable notice to the licensee before further use is prevented.

c. This section does not authorize an automatic restraint that affirmatively
prevents or makes impracticable a licensee&#8217;s access to its own information
or information of a third party, other than the licensor, if that information is
in the possession of the licensee or a third party.

d. A party that includes or uses an automatic restraint consistent with
subsection (b) or (c) is not liable for any loss caused by the use of the
restraint.

e. This section does not preclude electronic replacement or disabling of an
earlier copy of information by the licensor in connection with delivery of a new
copy or version under an agreement to replace or disable the earlier copy by
electronic means with an upgrade or other new information.

f. This section does not authorize use of an automatic restraint to enforce
remedies because of breach of contract or for cancellation for breach. If a
right to cancel for breach of contract and a right to exercise restraint under
subdivision (b) (4) exist simultaneously, affirmative acts constituting
electronic self-help must be taken pursuant to &#xA7; 59.1-508.16, including its
prohibition on mass-market transactions, instead of this section. Affirmative
acts under this subsection do not include (i) use of a program, code, device, or
similar electronic or physical limitation that operates automatically without
regard to breach or (ii) a refusal to prevent the operation of a restraint
authorized by this section or to reverse its effect.

HISTORY: 2000, cc. 101, 996; 2001, c. 763.