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This last month we seemed to have faced a rush of similar questions about copyright and shareholder issues. Hopefully these two questions and answers will provide useful pointers on commonly faced issues.
Q. I am getting a website developer to make a site for my business so that we can start selling on-line. I've sent them various photos from other sites which will be useful. A friend told me I had to be careful of copyright issues--what are they (and what about my site: will it be protected)?
A. For once "A. Friend" is right! You need to be wary of:
- breaching copyright of the photographers who took the photos you've taken from the Web
- breaching the copyright (or maybe the viewing terms) of the sites you've taken them from
- making sure that copyright in the site you get developed is transferred to you from the developer (for a creator of such a thing automatically owns the copyright in it--copyright is the right to stop something being copied etc).
But hopefully your contract with the developer will set all this out. You do have a web development agreement, don't you? It is an essential in our view. This is a big purchase for your business.
Your site will be protected by copyright. People may not lawfully copy it's wording, it's photos, logos and its general look e,g, colours, layout. There is more in this Copyright article on our website.
Please bear in mind this is a very general comment, copyright is a complex and very detailed subject. Do take advice if unsure.
Q. I am a shareholder in a small manufacturing business. There’s myself and another Directory / Shareholder and we want to formalise an agreement between us. Is a 50:50 shareholding the best way to proceed?
A. Almost always not. Indeed it can cause many problems. You can quickly get into deadlock on important issues about which you'll disagree. I know, you've been friends since school, she's a great girl, you never argue. Trust me, you will when running a company where your livelihoods are at stake especially when times are hard as they doubtless will be.
A properly drawn shareholders agreement can foresee and prevent such issues by setting out things which have to be agreed and by what method. It should probably also provide for mediation in the event of a dispute. I emphasised the words "properly drawn" as many that we see are inadequate and appear not to have been drawn up by people who have real experience of the issues that may arise. The danger is that you might think you're covered if you've got an agreement, but is it any good?
The article on shareholder agreements on our website highlights some of the things you should look out for. |
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