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How does joint ownership of intellectual property arise?

The joint ownership of intellectual property can arise in 2 different ways:

  1. An agreement may provide that intellectual property will be owned jointly by the parties, regardless of whether they were joint authors, joint inventors or joint creators.
  2. The parties may contribute jointly to the creation of the intellectual property and so are joint authors, joint inventors or joint creators.

What should an agreement address if there is to be joint ownership?

Sometimes, parties have an agreement, and agree on joint ownership of the intellectual property, but do not regulate their joint ownership relationship any further.

If joint ownership is to be agreed, it is critical that the agreement also address the following 3 questions:

  1. Can a joint owner exploit the jointly owned intellectual property?
    1. only with, or without the need for, the other joint owner's consent?
    2. only with the obligation, or without the obligation, to pay royalties (or other fees)?
  2. Can a joint owner grant a licence of the jointly owned intellectual property to another person?
    1. only with, or without the need for, the other joint owner's consent?
    2. only with the obligation, or without the obligation, to share the royalties (or other fees) received from the licensee?
  3. Can a joint owner assign its share of the jointly owned intellectual property to another person only with, or without the need for, the other joint owner's consent?

If an agreement does not address these questions, the joint owners will be regulated by the different and sometimes inconsistent laws that apply in relation to joint ownership.

It is therefore always prudent to specifically address the 3 questions above in your agreement, so that the jointly owned intellectual property is regulated in the manner that the joint owners agree, instead of the sometimes unpredictable and disadvantageous way that the law might regulate the jointly owned intellectual property.

Ownership proportion

The other matter that an agreement should specifically address is the ownership proportions held by the joint owners.

If the parties do not specify a joint ownership proportion, it will be presumed that they are equal joint owners.

However, joint owners do not always seek to be equal joint owners. Sometimes, one may make a larger contribution than the other (in money, resources, or an innovative contribution), which may justify an unequal ownership proportion.

In that case, it will be important to specify what the joint ownership proportion will be, or how it is to be determined, to avoid it being presumed to be equal.