Transferring Intellectual Property Rights

Intellectual property is transmissible by assignment, by testamentary disposition or by operation of law, as personal or moveable property. As assignment of title is not effective unless it is in writing signed by or on behalf of the assignor. Writing includes any form of notation or code, whether by hand or otherwise and regardless of the method by which, or medium in or on which, it is recorded. This needs to be in line with the relevant acts for the specific intellectual property.

Assignment can take place in several ways:

1. Automatic Assignment - where ownership of copyright transfers automatically to a third party e.g. by inheritance or by insolvency
2. Elective Assignment - where the owner chooses to transfer their rights, either by sale or by gift. For this to be valid, the assignment must be in writing and signed by (or on behalf of) the original owner.
3. Partial Assignment - where the owner wishes to assign only a part of your intellectual property. An assignment (or other transmission) of copyright may be partial, that is, limited in terms of either exploitation or time.

A common example where the copyright ownership needs to be established is where a business hires a third-party website developer to create a new website or software platform. As the website developer is the author of the work, they will own the copyright in the works unless the copyright position is dealt with differently in the contract. This is an example of how the rights are assigned partially.

The assigning of a registered trade mark is governed by the Trade Marks Act 1994 (the "TMA"). In particular, section 24(3) of the TMA states that an assignment of a registered trade mark, or an assent relating to a registered trade mark, is not effective unless it is in writing signed by or on behalf of the assignor or, as the case may be, a personal representative. Therefore it is vitally important to ensure that there is a signed intellectual property assignment agreement in place between the parties, otherwise the assignment may be invalid.

A trade mark assignment may be limited so as to apply to only some of the goods or services for which the mark is registered. It also may be limited so as to apply either in a particular manner or in a particular locality. It is possible that an attempt to assign a trade mark limited to a part of the period of its duration may be ineffective on the basis that the TMA does not expressly permit it.

The transfer should be recorded on the relevant trade mark register once it has been complete. This is important to keep the public record up to date and to enable third parties to obtain accurate information and a trade mark and its proprietors. If a transaction is not recorded on the trade mark register, it is ineffective against a third party subsequently acquiring, in good faith, a conflicting interest in or under the trade mark. If the transaction is not entered on the trade mark register within 6 months of the date of the transaction, the proprietor will not be entitled to damages or an account of profits in infringement proceedings.

Our intellectual property solicitors will be able to assist you if you are buying/selling/or assigning any trade mark rights and will also be able to draft the required intellectual property assignment agreement in order to finalise the sale.

Intellectual property rights that were owned to a company that has been dissolved then belong to the Crown. The Bona Vacantia division ("BVD") deals with the such intellectual property rights. They can sell bona vacantia intellectual property rights for their open market value. BVD will not transfer bona vacantia intellectual property rights to you for less than the minimum consideration and they will not transfer intellectual property rights with any title guarantee or provide any representations or warranties in connection with it. This means that when BVD sell rights they do not give any guarantee or assurance that the Crown has the legal right to sell them or provide any assurance about past disputes or other matters that might be relevant to a purchaser. BVD will always make their own independent assessment of the correct manner of disposal and who to sell it to.

Intellectual property rights can be jointly owned by two or more individuals. Joint ownership is common when you pursue business with another party, essentially a joint venture arrangement. If you jointly own intellectual property, you and the other co-owners are the only individuals that can exploit the intellectual property. You therefore cannot assign, licence or sublease the intellectual property to third parties. The only exception to this is where you and the joint owners have agreed that you are entitled to grant third parties the right to exploit.

An assignment of copyright is like the sale of personal property. When you sell your rights to a third party, you can no longer exercise control over how the third party uses those rights.

A licence is an agreement where you maintain ownership of the rights involved but allow a third party to exercise some or all of those rights without fear of a copyright infringement suit.

If you wish to maintain some ownership over your copyright, or control over how the third party uses your rights, you may wish to opt for licensing instead of copyright assignment.

Copyright is territorial and even in the European Union there is limited co-ordination, so the scope of protection for copyright works in the UK and for works abroad will remain largely unchanged. To the extent that UK law is derived from EU Directives and Regulations, it is preserved in UK law by the European Withdrawal Act 2018 and will remain so until the law is changed.

Intellectual property rights can be inherited when the owner of the intellectual property rights dies. The owner can leave their intellectual property rights as an asset for another business or another person. You can consider whether to split the rights into separate shares so beneficiaries receive different proportions (this applies for copyright) or you can detail your instructions for any patents owned, as the patent registrar will need a certified copy of the probate or letters of administration to update the register with the new owner details.