Table of Contents
- How can joint Intellectual Property ownership occur?
- What issues should be addressed in a joint ownership agreement?
- If shared ownership is to be agreed upon, the agreement must also cover the following three points:
- Proportion of ownership
- What are the consequences of joint Patent ownership?
- What are the implications of ownership of Copyright in Joint Works?
- What are the implications of ownership of Trademark in Joint Works?
- FAQ’s
When parties collaborate on creative initiatives or R&D, complicated issues about ownership of any generated IP emerge. Joint ownership of intellectual property may seem to be a simple and equitable solution if parties have collaborated and cannot separate the outcome of their efforts.
However, when parties fail to carefully explore how their jointly developed intellectual property will be owned, organized, and utilized, legal dangers, practical challenges, and barriers to full commercialization arise. In the great majority of circumstances, parties should enter into an affirmative agreement establishing joint ownership of intellectual property rather than relying on the default legal status.
How can joint Intellectual Property ownership occur?
Co-ownership of intellectual property may occur in two distinct ways:
- An agreement may state that the parties shall jointly hold intellectual property, regardless of whether they were co-authors, co-inventors, or co-creators.
- The parties may collaborate on the production of intellectual property, in which case they are referred to as joint authors, joint inventors, or joint creators.
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What issues should be addressed in a joint ownership agreement?
Occasionally, parties enter into an agreement to share intellectual property rights but do not further regulate their joint ownership relationship.
If shared ownership is to be agreed upon, the agreement must also cover the following three points:
- Is it possible for a joint owner to profit from a jointly held intellectual property?
- Can a joint owner provide another person with a license to the jointly held intellectual property?
- Can a joint owner transfer its portion of jointly held intellectual property to another person only with the other joint owner’s approval or without the other joint owner?
If no agreement addresses these issues, the joint owners will be governed by the many and possibly contradictory laws that govern joint ownership. Therefore, it is always advisable to address the three questions above specifically in your agreement so that jointly owned intellectual property is regulated in the manner agreed upon by the joint owners. Rather than the sometimes unpredictable and disadvantageous manner in which the law regulates jointly owned intellectual property.
Read: How does Intellectual Property protect a mobile App?
Proportion of ownership
The ownership proportions owned by the joint owners are another issue that should carefully be addressed in an agreement. If the parties do not state a joint ownership percentage, it is assumed that they are equal joint owners.
Joint owners, on the other hand, do not necessarily aim to be equal joint owners. Sometimes one person contributes more than the other (money, resources, or inventive ideas), which may explain an unequal ownership percentage. In such an instance, it is critical to explain the joint ownership share or how it will be calculated to prevent the assumption that it is equal.
What are the consequences of joint Patent ownership?
The law states that each joint owner possesses an equal portion of the invention and may use it for their gain without answering to one another unless the joint owners of a patent agree differently. However, without the approval of the other owner, one owner cannot give a license or transfer any interest in the patent.
Article 1152 of the UAE Civil Transactions Act defines joint ownership as follows: “Without prejudice to the provisions governing each heir’s inheritance share, if two people acquire one or more objects for any reason other than ownership without determining the share for each of them, they shall be co-owners and the shares shall be divided equally between them, unless evidence to the contrary is produced.”
What are the implications of ownership of Copyright in Joint Works?
When two or more authors collaborate to combine their contributions into inseparable or interdependent pieces, the work is referred to as a “joint work,” and the authors are regarded as joint copyright owners. The most prevalent collaborative work is when two or more writers contribute to a book or article.
According to Article 27 of Federal Law No. 7 of 2002 Concerning Copyrights and Neighboring Rights, the author of the literary or musical portion of the work has the right to publish his share in a manner different from how the joint work was published unless otherwise agreed in writing.
Read: What you must know about NFTs and INTELLTUAL PROPERTY (IP)?
What are the implications of ownership of Trademark in Joint Works?
Yes, it is possible to trademark a product that is co-owned. Multiple parties may possess a trademark. Two or more persons may register for the Trademark jointly if they intend to achieve joint ownership. In joint ownership, the relationship between the joint owners is such that both individuals and organizations utilize the Trademark together, but neither is the sole owner. The Trademark should be registered in the name of both parties.
In the UAE, Joint applicants for Trademark registration is possible provided that all applicants must sign the Power of Attorney, which is notarized and legalized up to the UAE Consulate. However, in the case of joint ventures, consideration should be made to who owns the Trademark that the joint venture will utilize. The Trademark to be used may be held by one of the partners. However, the partners should agree explicitly on who will have the Trademark or jointly own it. The Joint Venture Agreement should explicitly specify each party’s rights and what will happen to the Trademark when the joint venture is dissolved.
It is advisable to sign co-ownership agreements to carry out terms and circumstances controlling the relationship between the joint owners regarding usage and enforcement of the trademarks.
Also you need to know: New DIFC Law on Intellectual Property
The purpose of this article is to provide a general overview of the subject. Startups should assess the kinds of intellectual property that may affect their company and strategically consider patents, Trademark, and copyright protection. Your intellectual property (IP) may be your most important asset as a new business. Our IP expert at HHS Lawyers and Legal Consultants can help you identify and protect your IP rights right from the registration of your IP.
For more information on joint ownership of IP, don’t hesitate to contact us today.
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FAQ’s
What is joint ownership of intellectual property in the UAE?
Joint ownership of intellectual property in the UAE refers to a situation where two or more parties share rights in the same invention, work, or other protected creation. This commonly arises in collaborations, joint ventures, research projects, and co-creation arrangements.
How can joint ownership of intellectual property arise in the UAE?
Joint ownership can arise through a written agreement between the parties or through joint creation, such as where multiple persons are co-inventors, co-authors, or otherwise contribute to the creation of protected intellectual property.
Is a written agreement required for joint intellectual property ownership in the UAE?
A written agreement is strongly recommended. Without a clear agreement, the parties may be governed by the default legal rules applicable to the relevant type of intellectual property, which may not reflect their commercial intentions.
What should be included in a joint intellectual property ownership agreement?
A joint ownership agreement should clearly address ownership shares, rights of use, commercialization rights, licensing rights, assignment or transfer rights, decision-making procedures, confidentiality obligations, revenue sharing, dispute resolution, and what happens to the intellectual property if the relationship ends.
Can a joint owner use the intellectual property independently in the UAE?
The answer depends on the type of intellectual property and the agreement between the parties. For example, joint patent ownership and joint copyright ownership are not governed in exactly the same way under UAE law, so it is important to review the specific legal regime and any written agreement.
Can a joint owner license the intellectual property to a third party?
Usually, this should be governed by the agreement between the co-owners and the rules applicable to the specific intellectual property right. In patent matters, UAE law states that a joint owner may not grant a licence to third parties without an agreement between the co-owners.
Can a joint owner transfer or assign his or her share in intellectual property?
This depends on the type of intellectual property and the terms agreed between the parties. In relation to patents and utility model certificates, UAE law states that each joint owner may separately transfer his share unless otherwise agreed, but licensing to third parties requires agreement between the co-owners.
How are ownership percentages determined in joint intellectual property arrangements?
Ownership percentages are best determined by a written agreement. If the parties do not specify the percentages, the default position may be equal ownership, depending on the nature of the intellectual property and the applicable legal rules.
What happens if no ownership percentages are specified?
Where no ownership proportions are clearly stated, the law may treat the parties as equal owners in some forms of intellectual property unless they have agreed otherwise in writing. Because the result can vary by IP type, clear drafting is important.
What is the legal position on joint ownership of patents in the UAE?
Under the UAE industrial property law, each joint owner of a patent or utility model certificate may separately transfer his share, exploit the invention, and exercise the rights conferred by law unless otherwise agreed and without prejudice to the other owners. However, none of the joint owners may grant a licence to third parties without an agreement between them.
What is joint ownership of copyright in the UAE?
Joint copyright arises where multiple persons contribute to a work in a manner where the share of each person cannot be separated from the others. In that situation, they are generally treated as equal authors unless they agree otherwise in writing.
Can a co-author separately exploit his or her contribution to a joint copyright work in the UAE?
If the contributions are inseparable, no co-author may solely exercise the copyright without a prior written agreement among them. Where a contribution is separable, the legal position can depend on the facts and the parties’ agreement, so the matter should be reviewed carefully.
Can trademarks be jointly owned in the UAE?
Yes, trademarks in the UAE can be jointly owned by more than one person or entity, provided the legal requirements for registration are satisfied and the application is properly filed.
What should be covered in a joint venture intellectual property agreement?
A joint venture intellectual property agreement should address ownership of existing and newly created intellectual property, rights of use, licensing arrangements, registration responsibilities, enforcement rights, confidentiality, commercial exploitation, and the treatment of the intellectual property on exit, termination, or dissolution.
What are the risks of failing to define joint intellectual property ownership clearly?
Without a clear agreement, the parties may face disputes over ownership shares, use rights, licensing authority, commercialization, transfer rights, enforcement strategy, and revenue allocation. This can create uncertainty, delay business use of the intellectual property, and increase legal risk.
Why is it important to regulate joint intellectual property ownership by contract?
A well-drafted agreement reduces uncertainty, helps avoid disputes, clarifies how the intellectual property may be used and commercialized, and protects the interests of all parties based on agreed terms instead of relying only on default legal rules.
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