The UAE has emerged as a global business hub, providing numerous opportunities for businesses across various industrial sectors. To start a business and achieve the desired growth, a business should have proper resources or good expertise and knowledge in the business market. Startups and medium-sized companies are opting for joint ownership to achieve their desired business growth. While collaborating with other businesses on a project, you can share resources and expertise, which is also beneficial in reducing risk and achieving business goals. However, one of the central questions is who will own the IP developed during joint ventures.
IP ownership in Joint ventures in the UAE
A joint venture is an arrangement in which two or more businesses combine to share their resources for a project. These businesses will share the profit or loss. When an IP is developed during joint ventures, both parties could have contributed to its development. Both parties in the joint ventures would have their own IP, so in the joint ventures, there should be clarity regarding who owns the pre-existing IP and also regarding the IP which is created during the collaboration.
Additionally, there should be clear and transparent information regarding the maintenance of the IP, including registration costs, maintenance, and enforcement of the IP. To prevent conflicts regarding IP ownership, there should be a clearly defined IP agreement. IP agreements in Joint ventures will help ensure legal compliance and in managing and utilising the IP.
Is it possible to have Joint ownership for IP in the UAE?
Yes, in the UAE, joint ownership for IP is primarily possible for intellectual property such as patents, copyrights, trademarks, etc. Joint ownership is needed when both parties have contributed to the development of the IP. Joint ownership of an IP is a good choice when both parties have collaborated on a project and are unable to distinguish the output of their respective efforts.
To prevent any future disputes, there should be proper clarity regarding how the jointly created IP will be owned. To avoid any legal pitfalls and commercialisation difficulties, a relevant clause should be included in the IP agreement. The specific type of IP rights, such as the ability to license and assign the rights based on the type of IP and the written agreements between the entities.
Federal Law No. 36 of 2021 allows joint ownership of a trademark in the UAE. Two or more entities can apply for trademark registration, and the IP rights and responsibilities of each party must be clearly outlined in the agreement. According to Article 26 of the new Copyright law, joint owners of a copyright-protected work, in which it is not possible to separate the contributions of each owner, cannot exercise their rights to use, license or assign the work individually, unless otherwise agreed in writing. Under DIFC Law No. 4 of 2019 on Intellectual Property, rights over an invention created by two or more persons will be shared equally between them unless otherwise agreed in writing.
Key factors that businesses should consider during the Joint IP ownership
Usage of the jointly owned IP
There should be a relevant clause regarding how the business can use the IP. Can a party involved in a Joint IP agreement grant a license to another entity or individual, and can you transfer your jointly owned IP rights to another person? All these things should be addressed while developing a Joint IP agreement.
Identify the type of IP
Identify the type of IP which is being shared by entities like patents, copyrights, trademarks, etc. Also include the IP rights, which will be included.
Percentage of the IP ownership
Another key factor that should be included in the IP agreement is the percentage of the IP owned by both parties. The contribution in joint ventures will not always be equal, so when one entity has contributed more than the other, then it should be reflected in the ownership percentage. The contribution can be calculated in terms of money, resources, and ideas for the creation. To avoid conflict, it is necessary to include details regarding the percentage of IP ownership based on the contribution.
Non-disclosure agreements
To protect the confidentiality of the developed IP, both parties need to execute a non-disclosure agreement, so that the secrecy regarding the IP can be protected and the use of the IP is mostly for authorised and agreed purposes.
How Jitendra Intellectual Property can help you secure IP ownership in Joint ventures?
IP ownership is crucial for utilising assets without any legal conflicts. Businesses should ensure that a detailed legal agreement is in place regarding IP ownership and its usage. Jitendra Intellectual Property can help you with your IP protection. We can ensure that you acquire the necessary IP rights. Additionally, we can help businesses with IP registration, monitoring, and enforcement.
