Ask the Experts Q&A

Does the NDA protect me? Will my ideas be stolen?

August 27, 2013 Ask the Experts Q&A No Comments

I am about to publish a book and launch a line of plush dolls/toys to go with it. I already have prototypes of the dolls that I want to produce along with pictures to send to potential manufacturers. Should I worry about someone stealing my idea? I have the name of my idea/product trademarked and each individual character copyrighted. Please let me know if there is anything else I should do or is there an international non-disclosure agreement I should have company reps sign before I send pictures off.

1. First of all, register your IPR in China, ASAP. All IP laws & regulations in China are based on the protection for legitimate registered IPR. Furthermore, for IP registration, China operates a “first-to-file” system, which means, whoever first applies for IPR will be granted ownership. That means if you want to protect your IP in China, you should register it in China.

2. Sign an NDA or similar contract with your partner. Whether you want to sell, buy, or manufacture in China, make sure you sign a Non-Disclosure Agreement (NDA) or a contract with NDA clauses with your partners, who are probably your distributors, suppliers or local staff. In the NDA, you may specify that a penalty will be payable once either party breaches it, no matter if any actual damage has be made. Word of advice, it is vital to find a good partner, worst NDA +best partner is better than best NDA + worst NDA. Due diligence or IP audit is necessary when you choose your partner.

3. Register your IP with China customs. Though an NDA may work with a partner, you can’t stop any third party by signing an NDA with them. However, according to Regulations of the People’s Republic of China on the Customs Protection of Intellectual Property Rights, you may register your IP with customs to stop the infringed upon goods being shipped out of China.

Here is a short blog post “Intellectual Property Concerns” which address many of the issues you have raised and it includes links to blackbox manufacturing which is a way of using a trusted 3rd party in China to do the final assembly/branding so that the sub suppliers can’t easily see the finished product, thus protecting the IP.

Some more tips are included in the video series below.

Video 1: Finding Suppliers Video 2: Evaluating Suppliers Video 3: Negotiations Video 4: Project Management and Quality Control Video 5: Protecting Your Intellectual Property Video 6: Leveraging Global Sources Video 7: How to Find and Manage Partners for Logistics Video 8: Avoiding Scams Video 9: Returning Defective Products Video 10: Resolving a Dispute

 

I hope the comments and resources above will be of value to you. If you would like introductions to service providers who can help you find and manage vendors, please visit www.SourcingServiceCenter.com or feel free to contact me directly. I am happy to make introductions.  That link also lists China based, English speaking lawyers.

If you would like more tips and tools for dealing with vendors, check out http://www.chinasourcinginfo.org

 

Thanks again for your questions!

Question answered by Mike Bellamy.

Advisory Board Member & Featured Blogger at the not-for-profit China Sourcing Information Center (www.ChinaSourcingInfo.org). Author of “The Essential Reference Guide to China Sourcing” and founder of PassageMaker Sourcing Solutions.

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