Intellectual Property Rights for Fintech Businesses in Hong Kong

Understanding intellectual property in Hong Kong is essential for fintech businesses looking to protect their innovations and ensure compliance with local regulations. In Hong Kong, software is primarily protected by copyright under the Copyright Ordinance, which covers computer programs as literary works. Copyright protection arises automatically when the program is recorded, and no registration is required or available.

If the source code is kept confidential, it may also be protected as confidential information without the need for registration.

Under the Patents Ordinance, computer programs and business methods are generally excluded from patent protection. However, patents may be granted if the invention demonstrates a technical contribution beyond the software or business method itself, such as improving the functionality of the computer. Securing a patent for such inventions can be challenging, requiring careful drafting and formal registration.

Standard patents are granted based on patents from designated offices in China, the UK, or the European Patent Office, and offer up to 20 years of protection from the filing date.

Ownership of IP Developed by Employees and Contractors

Under the Copyright Ordinance, intellectual property created by employees in the course of their employment belongs to the employer, unless agreed otherwise. Inventions by employees are also owned by the employer if they arise from duties within their job description or are specifically assigned tasks where an invention could reasonably be expected.

For contractors or consultants, IP is owned by the individual unless otherwise specified in writing. However, the person commissioning the work has an exclusive licence to exploit it for reasonably contemplated purposes.

Joint Ownership of Intellectual Property

Joint ownership of copyright, such as for co-authored software, requires the consent of all owners for any use, licensing, or assignment of the IP. Therefore, joint owners should establish an agreement outlining how the rights will be exercised to avoid commercial challenges.

In contrast, for patents, co-owners each have an undivided share and can independently use or license the patent without consent from the other owners, unless an agreement specifies otherwise.

Protecting Trade Secrets

Trade secrets are protected as confidential information if they have a quality of confidence and are subject to a duty of confidentiality. Court proceedings can be used to keep such information confidential, with permission from the court.

Branding and Trademark Protection

Brands can be protected through registered trademarks or by common law under the tort of passing off if they have acquired sufficient goodwill. Certain design elements, such as logos, may also be protected by copyright or design rights.

Fintech businesses are advised to conduct thorough trademark searches using the Hong Kong Registry database to avoid infringing on existing trademarks. Searches for unregistered trademark rights online can also help prevent conflicts with existing brands.

Available remedies for IP infringement include:

• Injunctions (preliminary and final)

• Damages or an account of profits

• Delivery up or destruction of infringing goods

• Disclosure orders

• Recovery of legal costs

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