# Intellectual property clause

Source: https://contracko.com/glossary/intellectual-property-clause

# Intellectual property clause

A provision allocating ownership and use rights in intellectual property created or used under a contract.

## Definition

An intellectual property clause determines who owns the IP created during a project, what background IP each party brings, and what licences are granted over both. Without a clear clause, default rules can leave a paying client with only a licence rather than ownership of bespoke work. Good drafting distinguishes background, foreground, and third-party IP and addresses moral rights and assignment.

## Example

> The intellectual property clause assigns all software developed under the project to the client, while the agency keeps its pre-existing libraries.

## Why this is a business risk

A client that assumes it owns work it paid for, but is actually only licensed to use it, discovers the problem most acutely when the supplier relationship ends or becomes hostile: the client cannot move the work to a new supplier without consent. For agencies and developers, an unclear IP clause may inadvertently transfer ownership of reusable tooling or proprietary methods, limiting what can be offered to future clients.

## How to manage it

- Before signing, clarify whether you need ownership or whether a broad licence is sufficient for your intended use.
- List background IP brought by each party explicitly to avoid later disputes about what was "pre-existing".
- Under Dutch law, assignment of copyright must be in writing (Aw art. 2); ensure the contract contains the required deed of assignment.
- Address third-party IP (open-source software, stock assets): confirm licensing terms are compatible with your intended use.
- Ensure the clause survives termination so IP ownership is unaffected if the contract ends early.

### How Contracko helps

Contracko's AI analysis extracts IP ownership and licence terms from contracts and includes them in the obligations and key-terms summary, making it easy to audit who owns what across a portfolio of project and supplier agreements.

## Legal references

- [Aw art. 2 Copyright Act: assignment by deed Dutch law](https://wetten.overheid.nl/BWBR0001886)
- [BW 3:83 Dutch Civil Code: transferability Dutch law](https://wetten.overheid.nl/BWBR0005291)

Unless marked otherwise, references are to Dutch law (Burgerlijk Wetboek, the Dutch Civil Code); EU instruments such as the GDPR apply across the EU. This is general information, not legal advice. Other jurisdictions treat these concepts differently. Verify the current text and your situation with a qualified lawyer.

## Relevant for

[Software Development Agencies](https://contracko.com/industries/software-development)[Marketing & Creative Agencies](https://contracko.com/industries/agencies)[Film & TV](https://contracko.com/industries/film-tv)

## Related clauses

- [Intellectual Property Clause](https://contracko.com/clause-library/intellectual-property)
- [License Grant Clause](https://contracko.com/clause-library/license-grant)
- [Assignment Clause](https://contracko.com/clause-library/assignment)

## Related terms

- [Intellectual property](https://contracko.com/glossary/intellectual-property)
- [License](https://contracko.com/glossary/license)
- [Assignment](https://contracko.com/glossary/assignment)
- [Licence agreement](https://contracko.com/glossary/license-agreement)

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## Frequently asked questions

Common questions about this term.

- **Q:** Who owns IP created by a freelancer without an IP clause?
  **A:** Under Dutch copyright law, the author (the freelancer) is the default owner. The client gets only what was expressly granted. Without a written assignment, the client typically holds at most a non-exclusive licence for the agreed use.

- **Q:** Can moral rights be waived in a Dutch contract?
  **A:** Partially. Under the Dutch Copyright Act some moral rights (such as the right to attribution) can be waived, but the right against derogatory treatment cannot be transferred or fully waived. This must be addressed explicitly in IP clauses for creative work.

- **Q:** What is the difference between background IP and foreground IP?
  **A:** Background IP is what a party brings to the contract (pre-existing tools, methods, or content). Foreground IP is what is created during performance of the contract. Contracts typically say background IP stays with its owner while foreground IP is assigned or licensed.

- **Q:** Does an IP clause need to be in writing to be valid?
  **A:** For a copyright assignment, yes: Dutch law (Aw art. 2) requires a written deed. A licence can be oral, but written terms are strongly advisable for clarity and enforceability.

- **Q:** What happens to IP rights when a contract is terminated?
  **A:** It depends on the clause. Assigned IP does not revert on termination. Licences may terminate with the contract unless stated to survive. A well-drafted IP clause specifies expressly which rights survive termination and on what terms.

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