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Throughout the course of your business, you will engage with many different parties in various contexts. Some of them, you may enter into contracts with, such as contractors and clients. On the one hand, clients may engage your business to fulfil a service or design something for them. On the other, you can hire contractors to do work for your business on a limited basis, such as providing specialist knowledge for a project. There will be various legal elements at play in both of these relationships, and one of these elements is intellectual property (IP). These are your business’ ideas and creations, and they are valuable assets. As a result, you need to clearly establish with these other parties how to manage IP concerns and protect your business’ interests. Therefore, this article will go through five different IP protections for your business dealing with clients and contractors.

Register Business Trade Marks

Trade marks are signs or symbols that represent a unique aspect or badge of origin of your business. They can be a variety of things, including:

  • words;
  • symbols;
  • shapes;
  • colours;
  • smells; or
  • a combination of these.

This variety means that you can apply trade marks to different aspects of your business, such as registering a trade mark for your business name or its logo. When you have a registered trade mark, you have various legal rights that you can rely on to prevent others from using or commercialising it without your permission.

Having a trade mark is important when dealing with clients or contractors because you can prevent them from using your brand in a way that you do not allow. For example, clients cannot use your logos without express permission. Otherwise, they may face trade mark infringement claims from your business.

Copyright Ownership Rules

Copyright is another kind of IP right that protects the expression of ideas or information. It applies automatically from an original work’s creation. It can apply to:

  • literary, dramatic, artistic, or musical works;
  • sound recordings;
  • films;
  • communication works; and
  • typographical arrangements of published editions.

Typically, when someone creates a copyrighted work, they are the first owner of the rights that copyright generates. However, there are few times where this may not be the case, including when the creator creates a copyrighted work:

  • while employed for their job; or
  • for a commission that someone else has paid them.

This IP right is relevant for you because, depending on the nature of your relationship, you may employ or commission contractors, and clients may employ or commission you. These rules can protect your own IP interests, but they will also apply when you generate IP. Therefore, you must know both the circumstances that these rules may apply and define them in your contracts.

Contractual Provisions

In an overall contract with a contractor or a client, you should have a clause dedicated to covering IP concerns. It may simply be detailing the registered IP rights you have, but it is also useful for determining who retains ownership of IP in the relationship. This clarification is useful for avoiding disputes and using it as evidence if a dispute occurs.

For example, suppose a client commissions you to create software for their business, but you detail in your contract that you retain IP ownership over the code of that software. In that case, this can override the general commissioning rule.

When relating to IP, your client or contractor contract should at least cover:

  • what IP is relevant to the relationship;
  • what IP protection or registrations you both have;
  • the powers those protections give you;
  • who owns what IP, including already existing IP and what is to be developed; and
  • any other relevant IP matters.

Licensing

When you licence your IP, you permit another party to handle it in various ways, such as using it or trading with it. You can get something in return, such as royalties or fee payments. Notably, you can licence out IP you already own to your contractors or clients, depending on the nature of the relationship. Additionally, you will set out terms of that licence relationship that they must follow.

For example, if a contractor wants to use your trade mark in their advertising, they can pay you for a licence to do so.

If the other party violates the terms of a licence agreement, then you will have contractual remedies available. 

Designs and Patents For Your Goods

Designs and patents are other kinds of IP rights. They can protect the visual appearance of your goods or items, while patents protect new inventions. When you register these, you can get similar exclusive rights to them. You can also licence their usage to clients or contractors and pursue them for infringement if they use your patents or designs without your permission.

Key Takeaways

The law provides different kinds of IP protections that either exist automatically, or you need to register for. Both kinds are relevant for your relationships with clients and contractors. So, you must look into what IP rights will work for your business. If you would like more information or help with IP in contractor or client relationships, contact LegalVision’s IP lawyers on 0800 005 570 or fill out the form on this page.

Frequently Asked Questions

Should I register my business name as a trade mark?

People will recognise your business by its name and remember it later if it is an effective one. If your name is unique and brings value to your business, you should consider registering it as a trade mark.

What intellectual property protection should I get?

What intellectual property rights you should register will depend on the nature of your intellectual property. In some cases, copyright will automatically protect some of your intellectual property. In others, you will need to register specific intellectual property rights, such as trade marks, patents or designs.

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