IP Assignment HK: Cap. 528 s.14 and Cap. 514 s.57 Deed

The document does two jobs in one instrument. The confidentiality side binds the employee not to use or disclose the employer's protected information, during the engagement and for a defined period afterwards. The assignment side transfers ownership of every intellectual property right created in the role, including works and inventions that do not yet exist on the date of signature. A properly drafted Hong Kong version also carries a waiver of moral rights, a further assurance covenant, a power of attorney for patent and design filings after the employee has left, and a schedule listing any prior IP they bring with them.

Practitioners sometimes treat it as interchangeable with a confidentiality agreement. It is not. An NDA is usually mutual, aimed at an outside counterparty, and says nothing about ownership; for discussions with a supplier, investor or joint venture partner the right instrument is a mutual or one way non-disclosure agreement for external discussions. It is equally distinct from a restrictive covenant: confidentiality and assignment clauses protect information and property, while non-compete and non-solicitation clauses restrict conduct in the market and face a far tougher enforceability test.

Copyright is the starting point and the first trap. Section 14(1) of the Copyright Ordinance (Cap. 528) makes the employer first owner of literary, dramatic, musical or artistic works and films made by an employee in the course of employment, subject to any agreement to the contrary. Section 14 does not reach sound recordings, work made outside the scope of the role, or contractors at all. Section 14(2) adds a feature with no English equivalent: where the employer exploits the work in a way neither party could reasonably have contemplated, the employee is entitled to an award set by the Copyright Tribunal. An assignment is ineffective unless it is in writing and signed by or on behalf of the assignor under section 101, while section 102 lets future copyright vest automatically as it arises. Moral rights cannot be assigned under section 105, so a signed waiver is standard.

Inventions follow a separate track. Section 57 of the Patents Ordinance (Cap. 514) gives the employer inventions made in the course of normal duties, where an invention might reasonably be expected. In Acron International Technology Ltd v Chan Yiu Wai [2017] 3 HKLRD 799 the Court of Appeal held that the employer need only show that some invention was expected, not the particular one, and that later fine-tuning did not break the chain. Sections 58 and 59 let an employee claim compensation where a patent is of outstanding benefit, and those provisions cannot be contracted out of. Registered designs follow the same logic under section 3(3) of the Registered Designs Ordinance (Cap. 522). Trade secrets have no statute here and rest on the equitable action for breach of confidence, shaped by Faccenda Chicken Ltd v Fowler [1987] Ch 117: the implied post-employment duty covers genuine trade secrets, not everything an employee remembers. The wording sits on Hong Kong e-Legislation at section 14 of the Copyright Ordinance, and the agreement belongs beside the employment contracts and appointment letters drafted to the Employment Ordinance.

The obvious moment is the day a new engineer, designer, researcher or marketing lead accepts an offer, and it should be countersigned before the first day, not filed with the probation paperwork. The second moment is promotion. Hong Kong courts assess covenants as at the date they were entered into, so an analyst who signed a thin clause in year one and now sits across the pricing models is protected by a document that no longer matches the risk. Due diligence is the third trigger: any buyer, licensee or Series A investor will ask for a clean chain of title over the company's code and brand assets.

Contractors form the largest blind spot. Section 14 of the Copyright Ordinance applies to employees, so an agency, freelance developer or design studio keeps ownership of what it produces unless a written assignment says otherwise, which is why external work belongs in a master services agreement for outside contractors and agencies. Two edge cases deserve attention. An employee who contributes company code to an open source project can encumber the codebase with licence obligations that survive the assignment, and one seconded to a Mainland affiliate may create rights that belong to a group company rather than the Hong Kong employer.

• The definition of confidential information is tiered rather than catch-all, separating genuine trade secrets from ordinary business information, with carve-outs for material in the public domain and for the employee's general skill. Hong Kong judges have refused to enforce covenants where the employer could point only to business jargon, so the template asks you to name categories with real specificity.
• The present assignment of existing rights transfers copyright, design rights and inventions already created in the role, signed by the employee so that it meets the formality requirement.
• The forward assignment of future rights takes effect automatically as each right comes into existence, so the company does not need to chase a signature from someone who has already resigned. A further assurance covenant and limited power of attorney back it up.
• The moral rights waiver and consent to modification deals with the rights that cannot be assigned, and lets the company edit, adapt and publish work without attribution disputes.
• The schedule of excluded prior IP records side projects, open source contributions and anything the employee owned before joining, with a licence back where that material sits inside company products. An empty schedule signed by both parties is itself evidence.
• The return and deletion obligation covers devices, repositories, cloud accounts and printed material on the last working day. Where the employee handles customer records, it works alongside a letter of authorisation reflecting Hong Kong data privacy practice and the duties under the Personal Data (Privacy) Ordinance (Cap. 486).

Financial services produce the strongest enforcement record. In BFAM Partners (Hong Kong) Ltd v Mills [2021] HKCFI 2904 the Court of First Instance restrained a departing employee under a six month paid non-compete because the employer particularised its proprietary technology and trading strategies instead of asserting them. Licensed corporations should also align the clause with the Securities and Futures Ordinance (Cap. 571).

Technology and software businesses rely on computer programs being literary works, which brings employee-written code inside section 14. The gaps appear at the edges: contractor commits, code written before joining, and forks of internal tools pushed to public repositories. A disclosure clause covering every external contribution closes most of that exposure.

Life sciences and engineering turn on patents rather than copyright. Standard patents run for up to twenty years and short-term patents for eight, and the Acron decision shows that a broadly defined research role widens the employer's claim to whatever the employee invents. Invention disclosure forms and dated laboratory records decide those disputes.

Group and cross-border structures need naming discipline. A restraint expressed in favour of an employing entity and its subsidiaries has been struck down as reaching beyond the employer's own proprietary interest, so the assignment should identify the group companies that will actually hold the rights, particularly where the employee works across Hong Kong and the Mainland.

You begin with the employing entity, its Companies Registry number and registered address, then the employee's identity card details and job title. The form asks you to describe the category of work the role produces, and that answer shapes the assignment language: a software role pulls in source code, documentation and repositories, a design role pulls in registered and unregistered designs, a research role pulls in inventions and improvements. Next comes the definition of confidential information, where the guided fields prompt you to list actual categories such as pricing models, supplier terms or algorithm parameters instead of a blanket formula. You then set the survival period for post-employment confidentiality, choose whether to attach a prior IP schedule, and decide whether the document is signed as a simple contract or executed as a deed. The completed agreement downloads as Word and PDF, alongside the rest of the catalogue of Hong Kong legal documents HR teams issue on day one.

The most expensive error is trusting the statutory default. Employers discover during due diligence that the brand assets were drawn by a freelance illustrator, that the app was built by an agency, or that a co-founder wrote the original engine before incorporation. None of those rights moved without a signed assignment. The second error is timing. An assignment presented to a long-serving employee mid-contract can be attacked for want of consideration, which is why it is usually executed as a deed or tied to a promotion or bonus award. The third is drafting by catch-all: a definition covering all information relating to the business gives a court nothing to protect.

Three further traps recur in practice. Employers forget to refresh the agreement when an employee is promoted, leaving a document calibrated to a role the person no longer performs. They attempt to exclude the employee's right to compensation for a patent of outstanding benefit, which the Patents Ordinance does not permit. And they wait. Delay is fatal to injunctive relief, so where confidential material has left the building, the letter before action follows within days, not months.