Penrose has a team of lawyers that specialise in Intellectual Property in the Netherlands. To contact our Dutch legal team, click here.
IP rights in the Netherlands
Intellectual property rights (‘IP rights’) protect immaterial objects such as works, technical inventions, names and logos.
With an IP right, the owner obtains an absolute and exclusive right to use and exploit the protected work, invention, name or logo. This means that the IP owner can use the work and grant (license) rights of use with respect to the work, invention or brand name to others, under certain contractual conditions. This usually involves a license agreement.
IP rights that almost every entrepreneur encounters are copyright, trademark rights and trade name rights, but most probably also ‘trade secrets’. Trade secrets do not have the same status as IP rights, but are protected. In the Netherlands, the protection on confidential knowhow and trade secrets has been implemented in the Trade Secrets Act (in Dutch: Wet bescherming bedrijfsgeheimen, ‘Wbb’).You can read more about the Wbb and the protection of trade secrets in the blog ‘Protection of trade secrets in the Netherlands’.
Protection and infringement of IP rights
Intellectual property rights must be protected. In some cases, registration is a legal requirement under Dutch law, such as for trademarks or patents.
If another party uses your intellectual property rights – without your permission – you can take action. This is an infringement of intellectual property rights.
It is also possible for you to be held liable for infringing other people’s intellectual property rights. For example, you took a picture of Google and placed it on your own website without asking permission from the photographer.
To explore the possibilities for a potential collaboration with another party it is often necessary to reveal limited information about your business case and IP rights. A non-disclosure agreement (NDA) is a commonly used way of protecting your IP rights. A conflict about IP rights often ends in a settlement agreement.
License agreement for IP rights
The entitled party who wishes to make intellectual property rights or know-how available to another party – for example for production, distribution or commercial exploitation – can do so by means of a license agreement.
The license agreement determines the rights and obligations of the licensor (entitled party) and the licensee (the other party that is being granted the license). It can be agreed, for example, that the licensor is entitled to a royalty. The license may also be limited, for example to a certain territory/area or in duration.
IP rights in an IP-BV
Since intellectual property rights are essential to the business of many companies, you want to avoid exposing them to risk as much as possible, for example in a separate IP entity. The company runs a significant risk if the intellectual property rights have been transferred to the same limited liability company as where commercial activities take place. If the company finds itself in financial difficulties or even goes bankrupt, under Dutch law all intellectual property rights will end up in the bankrupt estate.
In many corporate structures, intellectual property rights are therefore transferred to a separate private limited company, an IP-BV where BV is the acronym in Dutch for a limited liability company. But placing IP rights in a separate limited liability company also offers advantages in terms of separating business models and issuing (e.g. white label) licences.
IP rights in Mergers and Acquisitions
If you intend to take over a (retail) brand or software developer, for example, the intellectual property rights play an important role.
After all, you want to be sure that the selling retailer has correctly registered the relevant trademarks, or that the software developer is actually the copyright owner of the source code of the software. Dutch law and EU regulations provide ample protection for IP rights in the event of a merger or company acquisition.
Dutch Intellectual Property specialists
Penrose has a team of Intellectual Property lawyers who are pleased to assist you and answer your questions. The contact details of our IP specialist is given here.