What legal avenues for protecting intellectual property are available to US companies who are outsourcing software to countries like China, India, Russia and the Ukraine?
Right now I have standard NDA and licensing agreements with my US based contractors, which have some enforcement and damages clauses but how do these hold up with in other countries? What do I need to do to protect my source code from appearing out on the internet somewhere?
Posts Tagged ‘Outsourcing’
What legal options are available to companies outsourcing software for protecting intellectual property?
Posted by admin on April 16th, 2011
Posted in Software Piracy 
Tags: Available, companies, intellectual, Legal, options, Outsourcing, property, Protecting, Software 
Comments OffLegal Issues with Outsourcing ? Outsourcing to India Never Faced
Posted by admin on March 15th, 2011
All the countries in the world have laws to govern communities, business, people, institutions, schools, private organizations, marriage, divorce, right to information, real estate, commercial property, residential property, offshore business, outsource business etc. India one of the biggest countries in world with huge population also has laws to govern all but here we will deal in more detail with outsourcing to India laws related to software development and how they have proved to be a boon to the offshore software development world.
Knowledge of outsourcing to India laws can be beneficial to both the outsourcing company and the service provider. But before we discuss the Indian laws regulating the software development part of the giant IT sector let us discuss what sort of legal issues both the companies involved in outsourcing to India can face. Here it is also important to remember that both the companies involved in outsourcing to India are from different countries.
Taxation:All the companies and earning members of the society are by law required to pay some part of the income as tax. The taxation requirements for both the companies in different countries will of course be different and so both the companies involved in outsourcing to India should educate themselves on the taxation issues arising.
Lack of Global Legal System:It is cardinal for the outsourcing companies to include the laws governing the legal issues in both the countries. This is required because of lack of a global legal system which would ensure laws in all countries of the world are same and hence make the process less confusing.
Local Laws:Often laws regarding privacy and data protection also vary depending on the local jurisdiction under which the company falls. Hence it is also vital to consider the local laws before hiring a particular outsourcing to India service provider.
Dispute Settlement:This includes many issues related to the breach of contract and how it can be settled. To make dispute settlement easy details about who will travel where, where the legal process for settlement will begin etc should be included in the contract.
Outsourcing to India in the field of software development is growing at a rate compared to none. One of the biggest contributors to its success as a big IT hub are the Indian laws and the legal procedures which make it very easy for both the parties involved to come to an agreement and do business satisfactory. Therefore we have mentioned in the title “Legal Issues with Outsourcing – Outsourcing to India Never Faced”.
Here are a few changes in the Indian laws which have ensured that the IT companies involved in outsourcing do not face any legal issues:
->Indian laws have been constantly changing to make them suitable to the present day business scenarios. ->It also complies with “agreement on trade related intellectual property right” and has also signed the “world trade organization agreement”. ->Many beneficial changes in the designs, patents, copyrights, and trademarks to bring about a change in the Indian intellectual property laws->By law it is required that the provider company ensures that “Proper Law of contract” is signed before the actual legal contract is signed. Proper law of contract directs which laws will be applicable in case of any legal issue. ->Indian courts will support the choice of law of the parties. ->While outsourcing to India both the countries have the right to decide which laws will apply to the contract, and under which jurisdiction the legal proceedings will take place.
Intellectual Property Protection Issues in Outsourcing
Posted by admin on August 23rd, 2010
Nature and critical importance of intellectual property vary across industries and types of business. Software development outsourcing requires high level of knowledge sharing between customer organization and vendor. Consequently, IP rights of stakeholders are involved in one form or another. Thus intellectual property management and data protection issues have become increasingly important for businesses utilizing offshore/nearshore outsourcing.
Intellectual property that can be transferred to the vendor may include software, data, business and technology processes, trade secrets, inventions, know-how as well as other confidential information and works of authorship. Furthermore some of it may belong to third parties and require licensing.
Both customer and vendor must properly administer their IP and stick to overall business objectives in order to effectively manage information sharing. Benefits of sharing IP assets must outweight risks associated with outsourcing.
The World Intellectual Property Organization (WIPO) emphasizes two critical IP-related concerns in offshore outsourcing: ownership of IP and “inadvertent, accidental or willful disclosure of confidential information and trade secrets” (loss of business knowledge). But in most cases these concerns can be overcome by properly conducting IP due diligence, thoroughly evaluating the vendor and taking appropriate IP-protection measures.
IP Due Diligence
Prior to concluding any outsourcing initiative customer organization should conduct IP due diligence and risk assessment. As a result the company will be able to safeguard its intellectual property and clearly define which functions should be kept in-house and which can be outsourced.
IP due diligence may include the following indicative steps:
• Identify areas of critical importance to your business
• Carefully assess business knowledge and determine if moving it outside the company or to an offshore location will compromise company practices
• Identify and document all of the IP assets associated with the outsourced task
• Determine ownership rights in the identified IP
• Carefully review third-party or jointly-owned IP
• Identify existing or alleged breaches of contract, infringements, disclosure of confidential information and trade secrets
• Assess how well the legal infrastructure in the foreign country will protect IP rights
• Determine jurisdiction and enforcement (applicable laws, their enforceability, dispute resolution mechanisms)
• Define termination, expiration or exit clauses of arrangement
• Determine other IP-related responsibilities if applicable: ongoing maintenance and upgrades to the IP; payments of transfer fees; product liability, IP insurance, etc.
Having conducted IP due diligence, the organization can proceed to evaluation of potential outsourcing partner. Results can be used during negotiation of outsourcing agreements to provide for IP-related issues that may arise.
Practical business negotiations should be initiated only after being satisfied with vendor’s reputation, resources and compatibility of business culture. They should focus on the steps needed to be taken by both parties in order to safeguard and ensure proper use, sharing, licensing, development and improvement of the IP during and after the relationship. It should also include any relevant IP assets of third parties.
Selection of the outsourcing vendor in the context of IP-related issues
When outsourcing, customer organization should scrutinize potential partner’s ability to safeguard confidential information of commercial value against misappropriation, misuse, sabotage, loss or theft.
• Check that the vendor has a documented and enforceable information security management policy in place
• Review outsourcing vendor’s data security and IP protection practices as well as processes they have in place to protect customer’s confidential information
• Check whether additional security policies can be implemented to protect your sensitive data
• Provide vendor with only the minimum proprietary technology or data needed to complete the project
• Insist on clear documentation of all source code of your project as it becomes your company’s property and is legally protected
• Scrutinize physical security and personnel practices, policies and procedures
• Demand tight human resources screening, look for employee retention figures
• Find out whether vendor does business with your competitors; if yes, ensure that there is no contact between respective teams
• Choose an established partner that complements your business strategy and understands how to implement required level of security
Practical measures for protection of intellectual property
Intellectual property is one of the company’s most valuable assets. This is especially true for SMEs and startups where it can be the only tangible assets. Risks of not protecting IP are further escalated when outsourcing comes into play. That’s why customer organizations must effectively deal with related issues and use all types of IP protection: physical, electronic and legal.
Physical and electronic protection of intellectual property
• Treat data security as an exigency
• Limit the number of people who have access to the full information
• Make sure that outsourcing vendor has a physically secure facility (mechanical and electronic access control, intrusion detection, video monitoring etc)
• Check whether offshore team uses computers without removable media to reduce the risk of unauthorized access to your IP
• Ensure that in-house employees understand what information can and cannot be shared
• Use firewalls, VPN, encryption and other measures to prevent breaches of security in electronic environment, which may lead to disruptions in the supply chains
• Protect important information, such as source code, with passwords and access codes, and make sure that they are not widely available (both onsite and offshore)
• Always maintain original copy of the source code
• Make sure that any test data being used does not reveal real information
Legal protection of intellectual property
• Determine what country’s legal system will govern and have jurisdiction over contract disputes
• Work to understand the legal system and culture of both countries
• Find out how IP rights enforcement works in provider’s country
• Negotiate a clearly stated contract that specifically addresses business knowledge and IP-related issues and make vendor responsible for the actions of its employees. This will allow to ensure appropriate protection, avoid disagreements and prevent litigation
• Clearly define compliance audit procedures prior to engaging into outsourcing relationships
• Clarify licensing and source code ownership
• Consider open source software issues
• Enforce individual privacy in the context of database protection obligations (if applicable)
• Rely on non-disclosure and non-compete agreements with the vendor or its team members for keeping vital business information confidential
• Define mechanism for possible dispute resolution and arbitration
IP protection and data security: Intellias practices
Intellias is very security-conscious and devoted to protecting intellectual property and business
knowledge of its clients. We recognize importance of protecting customers’ information and express strong commitment to safeguarding their privacy. Hence, respective ethical rules and privacy policies have been adopted at Intellias.
Modern encryption and access sharing technologies are commonly utilized at Intellias. This results in essentially secure infrastructure which provides reliable protection of information from unauthorized access by third parties.
Furthermore, we maintain high level of employee credibility through Non-Disclosure Agreements that comply with international standards and are designed for thorough protection of project information. All sensitive information that is passed on to Intellias during the project life cycle is stored in a secure environment.
Explicit authorship waiver agreements guarantee that the customer becomes the only owner of the code. Representative office in Switzerland enables Intellias to effectively deal with contractual and legal requirements as well as ensure compliance with European and international law.
Posted in Software Piracy Tags: intellectual, Issues, Outsourcing, property, Protection Comments OffSoftware Outsourcing India is a Wise Decision
Posted by admin on August 22nd, 2010
If you’re interested in developing high quality web applications that are robust and cost effective its better to contact a software outsourcing company from India. India has emerged as a major hub for software outsourcing services. The business is growing at a healthy pace of 30%
Why Software outsourcing from India
India has a very large number of English speaking populations, which is more than in any other non English speaking country. Add to that the lower manpower cost. Both the factors make it attractive to hire Indian software professionals.
Governmant of India has taken a lot of initiative for the fast growth of software outsourcing to India. They are providing tax incentives to Software industry and also setup Special Economic Zones for IT and software industry. These zones have all the infrastructure and provides simple licensing services to the software outsourcing company of India to save unnecessary time and lesser paper work.
Software Outsourcing India can give you about 40% – 60 % of net savings and help you stay nimble in today’s global economy that too at at un-imaginable speed. Being a distant customer, it would be a great idea if you get your custom application development a genuine cost. You can fetch great development benefits that too without the difficulties of managing it.
Apart form this Software outsourcing India helps in getting optimum quality work that includes high-end professionalism and security by the Indian software professionals. Software outsourcing India has helped businesses all across the world to get a good amount of work done at low cost and at the same time it has helped them to get the work done without having any tensions. Software outsourcing India also helps these businesses earn good amount of revenues as they provide the businesses with some of the best business strategies and business modules.
Take advantage of software outsourcing from India and relaxed. An established Indian software outsourcing company can provide you a quality work which can definitely prove a cost-effective business strategy for your dream business
Outsourcing 102
Posted by admin on August 9th, 2010
20 Steps to Successful Outsourcing
Objectives
The following 20-Step Program will provide you with a guide that would help you achieve the following:
* properly organize your team;
* achieve necessary management commitment;
* properly define your own corporate needs, objectives, and priorities;
* identify appropriate alternatives;
* identify and evaluated your risks and benefits;
* select the best alternative for each specified service area;
* developed and negotiated an appropriate and effective outsourcing agreement; and
* provide the mechanisms to administer, maintain, and monitor the contract and to resolve the inevitable problems.
20-Step Program
1. Organize a top management Steering Committee assigned in planning, monitoring, overseeing and searching for your transition to outsourcing. These includes members from your internal information systems division, key user groups, and executive management including marketing and/or strategic management. It is essential to factor the changing needs, markets, distribution channels from the beginning resulting to minimal surprises in the succeeding phases. Management also needs to be informed and be part of the process to make sure that there is due diligence being performed and to provide appropriate stewardship up over these key corporate information assets. This is to minimize the loss of important information resources, losing effectiveness, or leaving the company vulnerable to competition due to a screw up in an outsourcing deal which could lead to legal suits in the future.
2. Identify and engage an expert team to be able to guide you and the organization during the decision, selection, and contracting processes for your outsourcing needs. The team should include a small group of independent experts with specialization in outsourcing such as an information technology consulting professional who understands both you and your outsourcer in your needs and who is by far capable in helping you administer the contract over time, assuring a smooth transition to the systems, and resolve problems when the contract is signed. Then, an attorney with specific contracting, business, and outsourcing expertise to help develop and negotiate and outsourcing that would be beneficial to both parties and make the relationship work. Lastly, an organization development/merger and acquisition professional to make sure that the transition of staff and relationships works well.
This team is also warranted and needed to make tough decisions because perceived or actual weaknesses in your current IS team may have caused the failure of IS within your company in the first place. Also, engaging with independent experts to assist your IS managers will be wise because they themselves would probably be most directly affected by moving to outsourcing and the resulting contracts that goes with it.
3. Identify critical internal resources, such as a particularly competent data processing director or chief information officer, who will stay on your company’s staff internally assigned in managing and administering the relationship between the outsourcer and your company. Determine which staff, and software and hardware licenses and resources should/must go to the outsourcer for the relationship to be mutually successful.
4. Identify what is good and bad about your current installation in terms of:
* service
* capability
* performance
* uptime
* costs
* user satisfaction
* backlog
* on-time
* on-target systems delivery
* controls, etc.
Then assess each strength and weaknesses such as budget constraints, changing needs of internal users, top management commitment, resistance to change, lack of tools and human resources, staff development and ability to attract and retain quality staff, lack of methodology, hardware technology limitations, platform limitations, etc. Quantify and identify which are essential items and service levels and which components should be added, improved and attained in the outsourcing arrangement. Go for the “good enough” systems and targets that are attainable, affordable and of necessary quality.
5. Update the company’s strategic business plan. The typical outsourcing agreement would cover a period of 7-10 years. You should make it a point that you know where your company is going locally and globally in terms of products, markets, manufacturing, sources of supply, distribution arrangements, labor sources, etc., before you develop the systems plan to be able to support such direction and needs.
6. Develop a 7 to 10-year strategic systems plan to identify the long-term needs of the company that translate into the strategic business plan. Also, ascertain the new applications that will be required such as electronic data interchange, integrated manufacturing and production control using robots and automated “smart” buildings, international telecommunication networks, “intranets”, etc., which applications will be updated, which and when it will be discontinued, and which will be developed from the modified new applications software.
7. Identify the alternative hardware and operating systems alternatives and find out the recommended new architecture(s) needed to develop and support the new systems plan. This includes satellite communications, wide area networks, wireless communications, mainframe and client-server usage and inter-connect, specific operating systems, open-architecture decisions, database and programming language decisions, special development and maintenance tools, etc.
8. Understand your cost structure and determine/estimate future costs to build the projects outlined in the strategic systems and architecture plans developed mentioned in steps 6 and 7 above, including estimates of manpower and supporting hardware and software and equipment to aid you in building, upgrading, maintaining, operating, and controlling such systems. You should also recognize that over the next 5-10 years there is a need to estimate all relevant capital as well as operating costs; costs of supervising the outsourcer, likely increases in costs for salaries, benefits, service contracts, etc.; “cost of money”; interest costs; residual value of equipment and facilities; cost of transition, including personnel; cost of changes in direction and level of resources; cost of contract modification, etc. it is important to note that this is the most difficult task so you should be able to utilize your expert team for guidance and confirmation.
9. Identify your current and anticipated usage: normal operations, expanded operations over time, peak periods, off-site processing, storage, archive, integrations requirements, back up and disaster recovery requirements, etc.
10. Review the strengths and weaknesses of the outsourcing alternative. Establish how the outsourcing alternative will aid your company meet its long term goals and why it is a better alternative than staying in-house or partial outsourcing or working with multiple outsourcers. Determine which applications and resources should be outsourced and which to pursue using a different approach. Update this information and re-evaluate the decision throughout the entire decision-making process as new or better information is gained.
11. Using your expert team, identify several outsourcing alternatives. Get hold of the appropriate literature of relevant information from the team’s pre-selected short list of outsourcers. This should cover all of the technical and administrative things you will need to know about your outsourcer, you will also need to know in depth: corporate history and stability; current, new and lost customers; employee numbers, turnover, and experience levels; financial stability through a review of audited financials and footnotes; technological status including methodologies, tools, platforms, expected life of existing hardware; age of current applications; their own business and systems plan; downtime statistics; results of operational and security audits; customer surveys and systems demonstrations (both are critical and must be well planned); conversion commitment success/history (a must if you want your business to prosper); such intangibles as responsiveness, control, competition for resources, flexibility, etc.
12. Determine which areas of your company you would like to outsource. Identify a phased-in approach for outsourcing services if that is the desired method.
Services can be selected for virtually any part of your Information System areas including:
* All activities in a specified area (with only listed exceptions) vs. defined tasks
* Applications software
* Audit trails
* Backup procedures for programs, data, etc.
* Communications equipment, software, and interfaces
* Compliance with applicable laws
* Consulting services
* Daily and periodic processing and reports (accuracy; timeliness; formats)
* Data and program security
* Data conversion
* Data entry
* Development of new programs and systems
* Disaster recovery capabilities
* Equipment
* Help Desk
* Live system operation, management, and control
* Maintenance
* PC installation of hardware, software, and modifications
* PC service
* Personnel
* Physical security
* Pickup and delivery
* Provision of facilities, utilities, etc.
* Responsibility for troubleshooting
* Systems integration
* Systems software, tools, etc.
13. Develop a rigorous request for proposal (RFP) with a uniform format for you to be able to [...]
Outsourcing
Posted by admin on July 29th, 2010
AlphaeTech is offshore outsourcing services provider Company located in India. AlphaeTech have expertise team of experienced professionals with all required operational resources to provide high quality cost effective services at very competitive prices rate to maximize your profit and same your success. It is servicing it quality of services to USA, UK, CANADA, AUS, SWEDEN European countries.
What is outsourcing?
Answer: Outsourcing i.e. to utilize external resources i.e. transfer of management and day to-day business process of entire business function to an external services provider. The client organization and supplier sign a contractual agreement that define the transfer services. Under the agreement the supplier acquires means of production in form of transfer of people, assets and other resources from the clients.
Why choose outsourcing?
Answer: Outsourcing provide way to utilize all available global resources that help to provide high competitive quality solutions because there are lot of similar resources around the worlds and you have multiple choice to select best one among available to increase efficiency, accuracy and quality of your services on very reasonable charges.
Why choose AlphaeTech:
Answer: AlphaeTech is driving by staff of highly experienced qualified team of professionals provide you, high quality cost effective services .AlphaeTech is serving to the lot of highly satisfied global customers (clients) around the world and targeted from USA, UK, CANADA, AUS, and SWEDEN as excellent services provider..
AlphaeTech is growing rapidly because we know every buyer (client) needed three things cost, quality and quantity with piracy protection and this is our principal of success because we never compromise with satisfaction of our clients…
Our Services:-AlphaeTech is providing offshore business process outsourcing services expertise in Data Entry, Data Processing, Catalog Processing, Image Processing, Market Research, E-mail Extraction, Data Extraction, C-Book Publishing, e-magazine Publishing, PDF, HTML, XML tagging, Website Design, Website Development, Custom Software Development and related areas.
Outsourcing software development to India ? Cost effective Resourceful ?SAFE?
Posted by admin on June 15th, 2010
The factors such as low tariffs, availability of bandwidth at low cost, competition and growth in technology has made India the first pick for outsourcing software development jobs. But one thing that is often ruled out of such discussions is the legislative framework of the country regarding offshore software development. Apart from being the most cost effective and resourceful option India also has the most well structured legislative framework for offshore software development in the trail of developing countries. After the enactment of Information Technology Act 2000 the cyber frame work of the country is not to be mistaken as a shady affair.
Legitimacy to digital signatures:
Digital signatures play a crucial role in offshore outsourcing especially in closing agreements. It not only saves the time but is also a secure way of transferring codes and files over the internet. Therefore now companies can fall into contract through electronic means in the light of secure identity and legality of documents provided by digital signatures.
Legal recognition of transactions through electronic data inter-change:
India laid the order for legal recognition for transactions carried out by means of electronic data interchange and other means of electronic communication, commonly referred to as “electronic commerce”, which involve the use of alternatives to paper-based methods of communication and storage of information and to facilitate electronic filing of documents with the Government agencies. This has secured the transfer and handling of intellectual property in offshore outsourcing transactions.
Indian Copyright Act of 1957 amended in 1994 to outlaw software piracy:
“Computer programme” has been included in the literary work under Indian copyright act. “Computer Programme” means a set of instructions expressed in words, codes, and schemes or in any other form .This protects the intellectual property of the clients in the form of idea, source code or software involved in offshore transactions outsourcing software development to Indian companies.
Legal framework for e-Commerce and e-Transactions:
India has well laid legislations for e-Commerce and e-Transactions including e-contracts, computer crime prevention, electronic filing and documentation. This is based by e-transactions law, privacy/data protection; information security law including cyber security, public key infrastructure, cyber crime, taxes; intellectual property, e-financial services and more.
Convergence Bill:
This is another thing facilitating offshore outsourcing transactions. This is a unified billing system that simplifies tax calculations, credits and adjustments, handling collections, account suspension/reactivation due to non-payment, and reporting. Furthermore these billing systems are closely tied to customer care systems that enable customer acquisition, service order entry, and contact management.
Posted in Software Piracy Tags: cost, development, Effective, India, Outsourcing, Resourceful, SAFE, Software Comments Off