IP Assignment Agreement
An IP assignment agreement transfers ownership of intellectual property from a creator to a company, ensuring the business owns what it paid to build.
What is a IP Assignment Agreement?
An IP assignment agreement is a contract that transfers ownership of intellectual property — including software, designs, written content, and inventions — from the individual who created it to a company or other entity. It is distinct from a licence, which grants usage rights while leaving ownership with the creator.
For startups, IP assignment is critical at two stages. First, when founders incorporate: any IP created before formal incorporation (code written in a garage, designs sketched on a napkin) needs to be formally assigned to the company. Second, every time a contractor or freelancer builds something for the business, the company needs an IP assignment from that person — not just a licence.
Under Australian copyright law, the default rule is that the creator of a work owns the copyright. For employees, there is an exception — work created in the course of employment is usually owned by the employer. For contractors, there is no such default exception. Without an IP assignment, a contractor who builds your product may retain ownership of it, even after being paid.
When do you need a IP Assignment Agreement?
- ✓When incorporating a startup where founders have already created product IP
- ✓Every time you engage a contractor, freelancer, or developer to build anything for the company
- ✓When an employee creates significant IP outside the standard scope of their role
- ✓When acquiring a business or specific assets, including IP portfolios
- ✓When receiving IP from a research institution or academic collaborator
- ✓Before seeking investment — investors will conduct IP due diligence
Key provisions to include
Assignment of IP
Transfers all present and future IP created in connection with the defined work to the company, effective immediately.
Prior IP Schedule
Lists any IP brought into the engagement by the creator that is excluded from the assignment and retained by the creator.
Moral Rights Waiver
Under Australian copyright law, creators retain moral rights even after assignment — this waiver manages those rights.
Consideration
Records the compensation paid for the assignment, which is required for the agreement to be legally binding.
Representations & Warranties
The creator confirms they own the IP being assigned and it does not infringe any third-party rights.
Further Assurance
Obligates the creator to take any additional steps required to perfect the IP transfer, including registering patents.
Common mistakes to avoid
Assuming employment contracts automatically cover IP created by contractors — they do not under Australian law
Failing to document prior IP before engagement begins, leading to disputes about what is and is not assigned
Not including a moral rights waiver, which can restrict how the company uses the assigned IP in Australia
Using licence language instead of assignment language, leaving ownership with the creator
Not obtaining IP assignments before raising capital — investors conduct IP due diligence and missing assignments are a red flag
Frequently asked questions
What is the difference between an IP assignment and an IP licence?
An assignment transfers ownership of IP to the company permanently. A licence grants the company permission to use IP while the creator retains ownership. For startups, assignment is almost always preferable — the company needs to own its IP outright to attract investment and operate without ongoing permissions from the creator.
Do I need an IP assignment for employees?
Under Australian law, copyright in works created by an employee in the course of their employment is owned by the employer. However, it is still best practice to include explicit IP assignment provisions in employment contracts to cover edge cases, work created outside normal hours, and IP categories beyond copyright (such as inventions and trade secrets).
Can I use the same IP assignment agreement for all contractors?
You can use a standard template, but it should be customised for each engagement to accurately describe the work being assigned and any prior IP being retained by the contractor. Generic templates that fail to identify the specific IP being assigned may be challenged.
What is a moral rights waiver and why does it matter in Australia?
Under Australian copyright law, creators of literary, artistic, and other works retain 'moral rights' even after assigning copyright. These include the right of attribution and the right of integrity. A moral rights waiver allows the company to modify, adapt, and attribute the work without the creator's consent for each change.
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