Table of Contents
In Short
- Ensure you own software created by external developers by including written IP assignment clauses in contracts.
- Use robust software licence agreements to define usage rights, restrictions, and ownership clearly.
- Employ technical protections like encryption, confidentiality agreements, and staff training to secure software.
Tips for Businesses
Regularly monitor for unauthorised use of your software, and act quickly to address infringements. Proactively invest in legal advice to draft strong contracts and licence agreements. This ensures you secure ownership and enforce your rights effectively, protecting your software’s commercial value.
If you are a business owner operating in the technology space, your software code can be one of your business’ most valuable assets – representing a significant investment of your company’s time, money, and expertise. Taking proactive steps to protect your software can help you maintain control over its use, retain its value, and prevent unauthorised access, which could otherwise be significantly damaging to you. This article explores the importance of safeguarding your software and key legal and practical strategies your business can use to protect it from risk.
Why Should Your Business Protect Its Software?
Software can be vital in providing your business with revenue streams and a competitive advantage. However, competitors could misuse, copy, or exploit your software if you do not adequately protect it.
Some of the key intellectual property rights associated with software include:
- copyright, which automatically protects your software source code in the UK as soon as it is created and recorded. To strengthen your copyright protection, your business should document software versions and updates to maintain clear proof of authorship;
- trade secrets may also protect proprietary elements of software, e.g. unique algorithms within it. Trade secrets require confidentiality protection, so your business can protect them by way of confidentiality agreements; and
- trademarks may also protect the brand elements such as software names and logos. Registering a trade mark with the UK Intellectual Property Office can offer your business additional protection.
Which Practical Steps Can Help Protect Your Software?
There are a range of other practical considerations and steps that can help safeguard your software effectively.
Here are some of the key issues to consider to protect your software:
Have You Secured Ownership of the Software?
A key step is to ensure you legally own any software developed for you by third parties. When your business works with external developers, freelancers, or agencies, ownership of the software you commission them to create does not transfer over to you automatically. You must include valid written intellectual property assignment clauses in contracts to ensure the rights in the newly developed software are transferred to your business.
Suppose you created the software yourself (although you will have automatic copyright protection). In that case, you should keep strong evidence of this, e.g., records of your development, to help prove your ownership.
Are You Sharing Software Access With Third Parties With Care?
If you allow third parties the right to use your software, you must also safeguard it. Software licensing agreements can help you control how others use your software. A robust software licence agreement with your customers can help you set clear rules on your software’s permitted use and modification. For example, you can specify restrictions on how the customer may use the software and limit how many individual end users can access it.

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Your agreement should clearly state that your company owns the intellectual property rights in the software you are licensing. It must define the scope of the customer’s permitted use and explain the consequences if the customer breaches the licensing terms. This protects your software and ensures you can pursue legal remedies if needed.
Do You Have Robust Measures, Training and Safeguards In Place?
Confidentiality measures are vital when developing software. You should actively protect the confidentiality of your software products, for instance, by using robust confidentiality or non-disclosure agreements when discussing them with third parties.
It is also essential to train your staff on this, e.g., to warn them not to disclose your software code to third parties without first obtaining strict permission and protections.
Do You Regularly Monitor and Enforce Your Rights?
You should regularly monitor for unauthorised copies of your software on online platforms or marketplaces. You can use tools that detect infringement and can help identify misuse. If infringement occurs, you should take immediate action, such as sending cease-and-desist letters or taking legal action to enforce your rights.
Have You Taken Professional Advice on Software Protection?
Navigating software protection can be complex, particularly regarding ownership disputes, licensing terms, or identifying the proper protections for your software. A lawyer can help you with a strategy for protecting your rights, including:
- reviewing and drafting contracts to ensure IP ownership is clearly defined;
- drafting robust and tailored licence agreements to protect your software; and
- assisting with IP enforcement, including cease-and-desist letters and court action if infringement occurs.
Working with an experienced commercial lawyer can help ensure your business has a comprehensive strategy to safeguard its software assets, enforce its rights, and avoid costly legal disputes. Given the significant value of software assets, legal advice at an early stage can be an essential and sensible investment.
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Key Takeaways
Software can be a crucial business asset that requires strong protection to prevent risk. Protecting software requires various measures, such as robust contracts, technical safeguards, proactive monitoring, and urgent action on suspected misuse. These steps help your business safeguard its software, maintain its value, and avoid risk.
If you need help protecting your software, our experienced data, privacy and IT lawyers can assist as part of our LegalVision membership. For a low monthly fee, you will have unlimited access to lawyers to answer your questions and draft and review your documents. Call us today on 0808 196 8584 or visit our membership page.
Frequently Asked Questions
Copyright protection arises automatically when the unique software code is created and recorded.
A software licence agreement should include clear terms on permitted use, restrictions on modification or distribution, and ownership rights to prevent misuse.
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