Digital Agency Legal Needs

Concerned about the legal needs of your digital agency?

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Startup Lawyers Brisbane have helped many digital agencies start and scale their businesses as well as navigate their key digital agency legal needs.

Digital agencies come in a range of shapes, sizes and niche functions, however, at the core are some common legal needs which a specialised digital agency lawyer can help you with. Some of these legal needs are those which other businesses need too, such as employment structuring and agreements with their customers. Other more specialised areas for digital agencies are associated with issues such as intellectual property and, given the nature of the work and the increasing reliance on freelancers, an understanding of how to engage with sub-contractors.

Digital Agency Legal Needs: Specialised digital agency lawyer

Startup Lawyers Brisbane specialise in intellectual property, commercial and corporate law, (almost) everything you need from a digital agency lawyer!

Whether your digital agency provides digital marketing, SEO, graphic design, web development, film production or photography services, intellectual property is a common theme throughout all your transactions with employees, contractors, suppliers and customers. Specialised lawyers can guide you through your key digital agency legal needs. These could be from starting a digital agency, to managing your intellectual property, to hiring employees and freelancers and contracting with your clients through your own Digital Agency Agreement.

Now, let’s discus some of the key digital agency legal needs!

Digital Agency Legal Needs: Structuring your business

Starting a digital agency? Let us help select the right structure for you.

There are many government websites available which discuss the various structures you can use to operate your business. The Commonwealth Government provides this one. We don’t intend to discuss these in any detail, because we rarely recommend anything other than a company structure. However, where the circumstances are right there is a place for trading trusts.

Arguably the limited liability company (a legal construct) is the greatest economic innovation in the history of man. The limitation of liability on the shareholders (owners) is what has allowed people to invest in and form millions of businesses the world over. Of course, the directors still have obligations which must be fulfilled. The Australian Securities and Investment Commission provides useful information about directors’ duties.

While choosing a business structure is an important digital agency legal need, we often tell people the hardest task for them will be when we ask “what do you want your company to be called?” That’s not to say we encourage people to set up their own companies. Over the years we have seen too many horror stories arising from people without experience setting up companies and creating long term issues for themselves and their business! We suggest you have someone with the appropriate experience and qualifications (like us!) set up a company for you. At the same time, we can deal with ancillary tasks such as registering for GST, an ABN, tax file number and business name.

Digital Agency Legal Needs: Protecting and managing your Intellectual Property

Intellectual property must be assigned, in writing and signed by the owner. Without a written agreement, you may find that your rights to the intellectual property is limited.

Managing intellectual property (IP) is one of the key digital agency legal needs, yet often is misunderstood. The most common form of intellectual property for a digital agency is copyright. It subsists in images, video, photographs, copy and computer code. Intellectual property is then owned or licenced and any one project can consist of both licenced and owned IP.

Digital agencies often then can separate IP into:

Background IP, being the intellectual property owned and reused by the business;
Client IP, being the IP which the client shares with the agency for the purpose of them providing their services, like logos and trade marks;
New IP, which is often assigned to (as opposed to licenced to) the client who commissioned the work, at least that can be what clients expect; and
Third Party IP, which is used in a deliverable but is not owned by the agency nor the client. It is owned by another entity, like Wordpress (in the case of the PhP code) or Adobe (in the case of images sourced from Adobe Stock). Third Party IP is used by both the agency and the client under a licence.

Digital Agency Legal Needs: Hiring freelancers

Hiring freelancers is easier done than said! That is because there is more to it then clicking on Airtasker and hoping for the best.

Whether you are hiring a freelancer directly or through an online service and whether they are onshore or offshore, here are some of the key digital agency legal needs we advise clients of when hiring a freelancer (see more information on our sister site).

As we’ve already stated, IP is at the heart of digital products. Many products digital agencies produce are automatically protected by copyright. However, copyright can only be assigned in writing, signed by the owner. So, if you hire a freelancer to produce images, graphics, copy or other content for your business, and you don’t have a signed written agreement with them, they probably still own the IP and you likely only have a limited licence to use it.

If during the course of your engagement with a freelancer, you disclose to them confidential or personal information then you may be obligated by law to have some form of confidentiality agreement with them. That may be in the form of a Non-Disclosure Deed or confidentiality clauses in a Services Agreement, depending on the circumstance.

Another important consideration when you are hiring an Australian freelancer or contractor, is you need to understand your obligations around withholding tax where no ABN is disclosed, paying superannuation and considering that person’s status as employee / contractor.

You should note that even if the individual is a contractor you may have an obligation to pay contractors superannuation is often overlooked.

For more information about these issues see the Australian Tax Office website on paying superannuation to contractors and employee/contractor decision tool.

Digital Agency Legal Needs: Contracting with clients

What is a Digital Agency Agreement?

A Digital Agency Agreement can take a number of forms depending on what services the agency provides and importantly who the client is. The requirements of a small business like a barber shop (who may not care too much about the IP in a brochure) are very different to that of a large corporation (who would almost definitely want to own the IP in every component of their brand). Similarly, an agency conducting SEO for a client needs different terms to an agency producing a video advertisement.

However, there are some common clauses which would appear in each form of Digital Services Agreement, they include:

Services – Clauses which help define, and may be specific to, the scope of services being provided.
Acceptance – How a client can accept your Digital Agency Agreement.
Payment – How, when and what triggers payment for the services.
Liability – Clauses which aim to limit the liability your agency faces in contracting with a client, however, these are most often subject to the provisions of the Australian Consumer Law.
Intellectual Property – Which need to consider both ownership and licencing issues associated with background IP, client IP, new IP and third party IP.
Confidentiality and privacy – Which are both often important, particularly those agencies offering advertising and software related services.
Termination – Which may be varied depending on the services. SEO services may end after a fixed term and renew for further terms, while one off video productions may end upon delivery.

Startup Lawyers Brisbane has helped numerous entrepreneurs and organisations start and scale digital agencies providing a wide range of services.

We know tech.

All businesses today are running some form of tech. In fact, tech businesses are the fastest growing sector in the startup ecosystem. Even if you are not on the cutting edge of innovation you are probably engaging with businesses who are. If you are not you should be. Speak to a commercial lawyer with years of IT domain experience to help you navigate your IP and IT legal requirements.

Need a practical business lawyer, with IT, business, governance and accounting qualifications? One who spent over a decade running their own small business? The sort of commercial lawyer that can understand your business, your technology and your needs without you having to explain it in legal terms? Contact us today and speak to a multi-disciplinary commercial lawyer about your legal needs.