5 of the most important recommendations for reducing risk

5 of the most important recommendations for reducing risk


  1. Choice of the name of a legal entity. 

Often the project begins with the choice of a name for the firm. For example, registering a legal entity, with the names of well-known brands such as Pepsi Cola, Konica-Minolta or Bugatti, is not the most advantageous start for a potential successful business. This is common knowledge, and one does not need to be familiar with intellectual law to understands that such an action will not remain without conflict. It is recommended to conduct a research on the competitors in the market and outside of it to ensure that there are no similarities of such kind to avoid court disputes.

  1. Risks associated with the seizure of means of individualization. 

With the development of the company, it is possible, and even necessary, to register the trademark itself – for own goods, services or generally the company. Quite often, bold entrepreneurs, or “players” try to create problems for their competitors, who are also noticeable players in the same market area: registering trademarks similar to what was already used by a competitor, and later prohibiting the business from using them. 

  1. Improper registration of rights on created content. 

It is necessary to treat the registration of rights on the results of intellectual activity with due caution. Unfortunately, in the absolute majority of cases, because of the unwillingness to deal with paperwork “fuss” this procedure is disregarded. As a result, often a situation occurs where the end service or product (for example, the website and its design) includes some elements that belong to the intellectual property rights of other persons. On top of that, the contracts on granting or alienation of the right are frequently not properly concluded. 

A similar situation is already a considerable risk and threat to the realization of the project. The fact is that a former employee of the firm, who is also the owner of exclusive rights to any important elements of design, or a freelancer, if you wish, can create many problems for the company – up to a full ban on the use of the elements created by the individual (including co-authoring). 

Therefore, if the client cannot prove that the rights to the created intellectual products have been legally transferred (alienated) to him, then such a freelancer or an employee has a quite won case. In this case, the best way out of the situation is to conclude an agreement with such a seeker for easy profit. However, it is most likely that the conditions will be extremely unfavorable for the company. 

  1. Illegal use of other’s outputs from intellectual activity.

There are often situations where different subjects use foreign works (results of intellectual property) without the permission of the right-holder and without the permissible free use. 

Probably, it is connected to a certain common legal nihilism and a myth – “everything placed in the world wide web can be used without punishment, and there will be no consequences”. Such a tendency is evident within relatively well-established and authoritative companies. 

Without doubt, such beliefs arise from lack of knowledge and overconfidence. Illegal use of the product of intellectual activity belonging to other persons in any case will lead to serious problems, in particular, large financial charges and deterioration of the company’s reputation. Such examples are quite common in court practice on intellectual activity cases. 

And if it comes to that, the judicial and legal conflict with the legal owner will not positively contribute to the formation of a successful business. 

  1. Absence of a user agreement at the right time. 

The user’s agreement must be present if your site requires user-generated content (UGC). 

There are many cases when the Internet portal has been functioning for a long time and effectively and has been turned into an Internet platform with quality of content and involvement of users. However, it turned out that neither site administrators nor owners have received any consent from users to use this content. 

The use of foreign works (products of intellectual activity, etc.) without the permission of the owner provides a significant risk, connected with possible negative consequences. With accordance to the rules, every case of use of works should receive the consent of the owner of the product of the intellectual activity (rights-holder). 

As a result, implementation of the basic recommendations on compliance above and their adherence requires time and finance, which for many enterprises, especially small, is not a priority or is not planned. However, it is compliance-control that serves as a vital component of business success, which is based on the company’s information, commercial and financial security, business reputation and trust from contractors and clients. 

Name: Mykola

Surname: Siutkin

Email: siutkin@sp.agency

Phone: +380443830000

Company address: 10 Redutnaya Street, Kyiv, Ukraine


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