Drafting and registration of intellectual property agreements

In modern business, intellectual property assets are often no less valuable than tangible assets. Trademarks, copyrights, software, industrial designs, inventions, utility models, databases, design, content, technologies, and commercial identifiers may shape a company’s market value, competitive advantage, and investment attractiveness.

For such assets to work effectively for a business, it is not enough to create or register them. The rights to these assets must also be properly documented. This is where intellectual property agreements become essential.

VINCO`S Legal Company drafts, reviews, and supports the execution of intellectual property agreements for authors, IT companies, manufacturers, brands, startups, investors, franchisors, right holders, and businesses that use or commercialize creative and innovative results.

Intellectual property has its own legal specifics. It is not always sufficient to simply state in an agreement that rights are “transferred” or that the customer “receives the work product”. If the subject matter, scope of rights, methods of use, territory, term, remuneration, or warranties are not clearly defined, this may lead to disputes, loss of control over the asset, or difficulties in proving ownership of economic rights.

In practice, problems often arise when a company uses a logo, website, software code, design, photographs, videos, texts, or other content without properly documented rights from the author, contractor, employee, or counterparty.

A properly drafted agreement defines who owns the economic rights, who may use the asset and how, whether rights may be transferred to third parties, whether remuneration is payable, what warranties are provided by the right holder, and what consequences apply in case of breach.

The VINCO`S team prepares various types of agreements concerning the management and disposal of intellectual property rights, including:

• agreements on the transfer of exclusive intellectual property rights;
• license agreements;
• agreements on the granting of exclusive, sole, or non-exclusive licenses;
• sublicense agreements;
• agreements on the creation and use of intellectual property objects on commission;
• copyright agreements;
• agreements with designers, photographers, copywriters, developers, and other authors;
• agreements on the creation and use of software, websites, databases, and digital content;
• trademark use agreements;
• commercial concession / franchise agreements;
• agreements on the transfer of rights to inventions, utility models, or industrial designs;
• agreements on joint ownership or joint use of IP assets;
• NDAs and confidentiality agreements for the protection of ideas, technologies, know-how, and commercial information.

A copyright agreement regulates the creation, use, or transfer of economic rights to a work. Such an agreement may cover texts, musical works, photographs, illustrations, design, videos, software, databases, architectural works, audiovisual works, and other copyright-protected objects.

It is important to distinguish between the author’s moral rights and economic rights. Moral rights generally remain with the author. Economic rights, however, may be transferred or licensed to another person under the terms of an agreement.

The agreement must clearly define which rights are transferred or granted, for which methods of use, in which territory, for what term, for what remuneration, and subject to which limitations.

A license agreement is used when the right holder does not transfer the rights in full but grants another person permission to use an intellectual property object under specific conditions.

Such an agreement may relate to a trademark, copyrighted work, software, industrial design, invention, utility model, database, or another IP asset.

Depending on the arrangement, the parties may provide for:

• an exclusive license, where the right of use is granted only to one licensee and the licensor may not use the object within the relevant scope or grant other licenses;
• a sole license, where the license is granted to one licensee, while the licensor retains the right to use the object independently;
• a non-exclusive license, where the licensor may use the object independently and grant licenses to other persons;
• a sublicense, where the licensee, with the licensor’s consent, grants the right to use the object to a third party.

An agreement on the transfer of exclusive economic rights is used when the right holder transfers economic rights to an intellectual property object to another person in full or in part.

After such transfer, the acquirer may independently use the object, permit or prohibit its use by others, enter into license agreements, commercialize the object, and protect the rights in case of infringement.

For this type of agreement, it is particularly important to clearly define:

• the exact object being transferred;
• whether all economic rights or only part of them are transferred;
• the moment of transfer of rights;
• the territory of the rights;
• the term of transfer, if it is not perpetual;
• the amount and procedure for payment of remuneration;
• the right holder’s warranties regarding ownership of the rights;
• liability in case of third-party claims.

Special attention should be paid to agreements under which an intellectual property object is created on commission. These may include design, websites, software, brand books, photo or video content, architectural projects, texts, databases, advertising materials, or other creative or technical results.

In such agreements, it is not enough to describe only the technical specification and payment terms. It is necessary to separately determine who will own the economic rights to the created object, when those rights will transfer, whether the author may use the work in a portfolio, and whether the customer may modify, adapt, or transfer the object to third parties.

Depending on the type of object and the cooperation model, an intellectual property agreement should clearly regulate:

• the parties and their authority;
• a precise description of the IP object;
• confirmation that the rights belong to the right holder;
• the list of economic rights transferred or licensed;
• methods of use of the object;
• territory of use;
• term of the agreement and term of use of rights;
• remuneration, royalties, lump-sum or combined payments;
• reporting and control over the use of the object;
• possibility or prohibition of sublicensing or transfer of rights to third parties;
• confidentiality and protection of commercial information;
• warranties of the parties;
• liability for infringement of third-party rights;
• procedure for amendment, termination, and withdrawal from the agreement;
• consequences of termination of the agreement.

Intellectual property agreements must take into account the specific object, business model, monetization method, risks of the parties, and future use of the result. A template document often does not reflect the actual arrangement and may create more risks than protection.

For example, if an agreement with a developer does not define the transfer of economic rights to software code, the company may later face difficulties selling the product, attracting investment, or transferring rights to a client. If an agreement with a designer does not regulate rights to a logo, difficulties may arise during trademark registration. If a license agreement does not contain clear restrictions, the licensee may use the object more broadly than the right holder intended.

For certain intellectual property agreements, registration or recordal of information in the relevant state registers may be advisable or required. This depends on the type of object, the nature of the agreement, and the parties’ objectives.

In particular, agreements concerning economic rights to a work may be registered under the established procedure. Information on the transfer of rights or granting of licenses for certain industrial property objects may also be recorded in the relevant registers in cases provided by law.

Registration or recordal may help confirm the fact of conclusion of the agreement, its date, the parties, the scope of transferred rights, and strengthen the evidentiary position in case of a dispute.

VINCO`S Legal Company provides comprehensive support for intellectual property agreements.

We can assist with:

• analysis of the existing cooperation model and risks;
• determining which agreement is required in a particular situation;
• drafting copyright, license, and other IP agreements;
• preparing agreements for IT, design, advertising, manufacturing, franchising, and creative industries;
• reviewing agreements proposed by counterparties;
• drafting agreements on the transfer of economic rights;
• drafting agreements for commissioned IP objects;
• preparing NDAs and confidentiality clauses;
• supporting negotiations with counterparties;
• registration of agreements or recordal of information in relevant registers where necessary;
• protection of rights in case of breach of agreement.

If your business creates, uses, purchases, sells, or transfers rights to intellectual property objects, the VINCO`S team will help you properly structure the contractual relationship and reduce legal risks.