Mobile apps are big business and the UK currently takes the lead as the most lucrative mobile app market in Europe with revenue from app sales reaching $3.4 billion in 2021.
Of course, there are businesses built around apps, where the app is the central product, and then there are businesses using apps as a way to communicate with their customers or enable users to perform particular tasks. For instance, most supermarkets have apps for customers to access and manage their club cards; retailers have shopping apps and apps from travel companies/services give customers the ability to book and access tickets as well as track journeys; and exercise studios use apps to enable customers to view the class schedule and book into sessions. So, companies may develop a mobile app to enable their clients/customers to make transactions and engage whilst on the go. In some cases though, the central business idea is the app, such as with the dating app, Tinder or the fitness app, Couch to 5K.
Whatever camp your business falls into, there are a number of legal considerations for mobile app development. Allow me to take you through some of the legal documents and agreements you might put in place when developing your app, as well as relevant legal knowledge you will need to know about and the pitfalls you could fall into (and how not to).
Trade-marking Mobile Apps
Before you progress with your app idea you’ll want to check similar products do not already exist. There is nothing to stop you from setting up a business/launching an app that is similar to another. For instance, there are multiple dating apps. However, there are laws in place to stop developers from copying another product too closely, so you may want to consider the following:
Patents - Apps that have unique features may hold patents for their ideas, code and designs. Patent breaches may not only threaten your business but could also result in legal action being taken against you. To check if a similar patent to your idea/invention already exists, you may search the Ipsum database.
If you believe your idea to be unique you may consider protecting it with a patent. It would need to have a novel technical effect. Find out more about patent applications here. If this is something that you think may apply to your idea then you should seek the advice of a specialist patent attorney, who will be able to advise you as to whether your idea is patentable and write the patent claims/complete the patent application for you.
Trade Marks - Do you have a name or logo for your mobile app you would like to protect? First, you must ensure it is not already in use. If not, you may consider registering a trade mark to protect and retain exclusive usage of your trade mark/business name within certain guidelines. Here are my 7 Simple Steps To Protect Your Brand With Trademark Registration to give you a comprehensive guide to the trade-marking process.
Agreements For Mobile App Development / Mobile App Developers
As in any commercial collaboration, you’ll need an agreement in place to determine and clarify the business arrangement. If you are outsourcing your mobile app development to a person or agency you should have a legal agreement in place to protect both parties.
Legal considerations for mobile app development in your agreement would usually specify:
Expected specifications for and capabilities of the mobile app, including key functionalities
Need for the app to meet with UK data protection/GDPR requirements
Intellectual property ownership - that the copywriter for the app is transferred to and owned by the commissioner and not the developer/creator
A strong confidentiality clause - especially if you are planning on applying for a patent. (A patent is not registrable if it’s already in the public domain - so no talking without an NDA in place or your agreement with a robust confidentiality agreement signed).
Fees and cancellation policy - For more on this see my article on What To Include In Your Terms Of Business
If you're a business owner hiring a freelance app developer or agency for a mobile app development project then a services agreement is most likely the most suitable. However, if you’re a start-up working in a partnership arrangement with a fellow founder who will be developing the app, then a partnership agreement may incorporate the legal terms for mobile app development and other endeavours embarked upon on behalf of the company.
A partnership agreement would establish the distribution of ownership of the company and what happens in the case of a breakdown of the business relationship. However, it may also include directives such as anything developed or created for the business is the intellectual property of the business and not the creator.
If you are a business owner employing an app developer, then the employment contract should cover the above and protect the business, since the work will be owned by the employer, not the individual developer.
In need of advice regarding licensing and assignment of intellectual property rights? Please get in touch.
Mobile App End User Licence Conditions
When you are ready to launch your app, you will need user terms and conditions (sometimes known as terms of use or end-user licence conditions or simply the ‘EULA’).
This is an agreement between your business and the customer that explains the rights and responsibilities of each party. Your terms and conditions set the ground rules for app usage and protect the interests of both yourself and your app users.
Mobile app end-user licence conditions may include:
How the app may be used and how to manage registrations/subscriptions (if applicable)
Prohibited uses of the app and the consequences of breaching this
Details of IPs, copyrights, trade marks, patents, etc associated with the app (emphasising ownership and limitations of use)
Payment and cancellation information, including refund policies and payment methods
Privacy policy and data protection - this must be in accordance with UK data protection laws. If you’re transferring data out of the UK then you’ll want to look over our UK GDPR Compliance Checklist
Termination clause for both parties that may also lay out the resolution process for any disputes, that may arise
Limitations of liability - specifying the level of responsibility assigned to the provider in cases of losses and/or damages incurred by the product user when using the product
A caveat to explain that terms are subject to change and what the customer's rights are regarding being notified and able to opt-out should modification of terms occur
Terms of use are not always straightforward and they need to cover a range of possibilities and scenarios. If you are planning to make an app you’ve developed available to the general public, I recommend using a commercial lawyer to develop bespoke, detailed and robust mobile app terms and conditions contract for you.
Legal Compliance You May Need To Adhere To For Mobile App Development
Aside from the contracts you will need in place to protect your app, there may also be other legal considerations and compliance requirements. It is a good idea to familiarise yourself with the following and consult a commercial lawyer if you have any queries or would benefit from consultation.
Advertising Standards - The ASA is the Advertising Standards Authority. In the UK we have regulations over what can and cannot be included in advertisements. Advertising codes are written by the Committee of Advertising Practice (CAP) and upheld by the Advertising Standards Authority (ASA). If you are launching a mobile app you be working with advertisers and/or advertising the app yourself. If so, you must understand the UK guidelines on advertising to avoid complaints that could result in fines and/or damage to your reputation. Find out more about ASA regulations.
Data Protection - This has come up several times already because it is so important. Data protection is a big deal and rightfully so. Users of your app will likely have to share some data with you to be enabled access and you need to have policies and procedures in place to protect that data. The ICO (Information Commissioner’s Office) oversees the regulation implementation of data protection in the UK and you will likely need to register with them.
ICO Children’s Code - If your app is targeted towards those under 18 or may be accessed by under 18s then you have a responsibility to protect them to a greater extent even than you would a legal adult. This responsibility is outlined and specified within the Children’s Code.
The Children’s Code is part of the Data Protection Act 2018 and provides guidelines on communication with and the information and services organisations provide to children and young people. Your mobile app functionalities and scope of use may be limited if you are enabling under-18s access to the app so it's important to be familiar with the ICO Children’s Code, perhaps before even embarking on development.
Operator Agreements - You will likely need to sell your app or provide access to the app via a third-party operator. Each operate will have its own user agreements and in order to host your app on their platform you will need to comply with their terms and conditions. It will be worth exploring these to ensure that you are developing a mobile app you will be able to market and promote on platforms that may include Apple Store and Google Play.
Consumer Laws - Most apps are used by ‘consumers’ - being individuals and not business organisations. Therefore you need to make sure you are complying with all the relevant consumer laws that exist in the UK. Have a look at this handy checklist from The Citizens Advice on the key rights to be aware of.
Get in touch if you are planning an app and what to talk about the key issues/legal documents you need to think about. Aubergine offers a free initial 30 minute consultation to all new clients. Plus we love to hear about exciting plans (and obviously everything is kept confidential!).