Joint technology development contracts, be sure to check these!

Law firm Veat provided online promotion services company (hereinafter "customer") to review the joint technology development agreement with another corporation and provided guidance on legal risks so that the business could be successfully carried out.

What are the key elements of a Joint Technology Development Agreement?

A Joint Development Agreement is an agreement that must be concluded when two or more companies jointly develop technology in order to specify the various matters regarding the rights and obligations relationship related to the technology development.

If the content of such a joint technology agreement is unclear or important provisions are omitted, the roles, rights, and obligations of each party may become ambiguous, increasing the likelihood of future legal disputes between the parties. Therefore, a thorough review by a legal professional is necessary.

In this contract review process, Law firm Veat focused on checking and supplementing the following items.

1. Clarification of the objectives and scope of work for joint technology development

If the development goals expected by the contracting parties differ, there is a high probability of conflict during the project. Also, the scope of work for each contracting party must be clarified so that if a problem arises later, it can be determined which party is at fault and appropriate action (such as damage compensation or contract termination) can be taken.

Accordingly, Law firm Veat defined the objectives and scope of work for joint technology development in the contract so that the parties could proceed with development in the same direction.

2. Clarification of the development period

Joint development projects generally take a long time, so the development period and schedule must be clearly stated in the contract. The development period can be specified by a specific date or by achieving a specific condition. Also, if it is likely that the development period will be changed due to the nature of the development, regulations should be established at the time of contract conclusion regarding the method for adjusting the development period so as to prevent disputes related to the development period from arising later.

In order to determine the details of the provisions related to the development period when concluding a joint development agreement, a clear understanding of the development project is necessary. Law firm Veat has extensive know-how based on numerous cases in this regard, and has defined development period provisions suitable for the customer’s development project.

3. Preparation of Non-Disclosure Agreement (NDA) Clause

In the process of joint technology development, there is a high probability that the core technology of each company will be shared, so a Non-Disclosure Agreement (NDA) clause must be thoroughly prepared so that each party can collaborate without worrying about technology leakage.

When establishing such a confidentiality clause, it is important to determine the scope of the confidentiality obligation and the duration of the obligation in years. These matters should be determined based on the nature of the joint technology development covered by the contract.

For example, if the technology information learned through the joint technology development should not be disclosed even after several years and is a company’s core secret, it would be necessary to set a long duration for the confidentiality obligation.

4. Preparation of Clause Related to Ownership of Results

Ultimately, the reason for joint technology development is generally to produce certain results, such as intellectual property. Therefore, it is the most important part of a joint technology development agreement to clearly define the ownership and usage rights of the results generated as a result of such joint technology development.

If this is not clearly stated in the contract, there is a possibility of disputes over the ownership of technology and patents even after the development is completed.

In particular, it is necessary to stipulate in detail the method of attribution of the jointly developed technology, the right to file a patent application, and whether or not to grant a license, so as to prevent unnecessary disputes related to the attribution and license usage of the results from arising later.

5. Adding Other Clauses Necessary for Joint Technology Development

In addition, considering various risks that may arise in the process of joint technology development, clauses such as contract termination conditions, liability for damages, and dispute resolution procedures have been added. This allows each party to respond stably in unforeseen circumstances.

Veat’s Differentiated Legal Advice to Help Companies Collaborate Smoothly

Through this joint technology development agreement review, Law firm Veat has established a fair and clear contractual system so that cooperation can proceed smoothly between the customer and another corporation.

In particular, legal professionals specializing in the IT and technology fields thoroughly reviewed the contract to prevent various legal problems that the customer intending to develop technology may face in advance.

Companies planning joint technology development should always have a legal professional review the contract before signing it. Law firm Veat provides customized legal advice based on a precise understanding of the characteristics of technology development projects and business models, and a deep understanding of related laws such as the Intellectual Property Basic Law, helping customers establish stable cooperation structures and focus on company management.

If you need legal advice regarding joint technology development agreements and intellectual property rights, we recommend that you seek help from Law firm Veat at any time.

You can find the details of this business case on the Law firm Veat blog below.

- Be sure to check this when concluding a Joint Technology Development Agreement!

Thank you.

Law firm Veat