Who owns the IP when your engineer is in China

The clause you already use probably says the IP is yours. Whether it actually transfers depends on which law governs the contract it sits in — and if that contract is with a contractor in China, the answer may not be the one you assume.

The assumption worth checking

Most UK and US engineering contracts contain an assignment clause along the lines of "all intellectual property created in the course of the services shall vest in the Company". Under English law, with an employee, that is close to automatic anyway — section 11 of the Copyright, Designs and Patents Act 1988 gives an employer first ownership of work made by an employee in the course of employment.

Two things in that sentence do not hold when your engineer is a contractor in China. The first is employee: a contractor is not one, so the default flips and the creator owns the work unless something moves it. The second is English law: your assignment clause only does what the governing law of that contract lets it do, and your contract is not the one the engineer signed.

That is the crux, and it is structural rather than legalistic. If you contract with an intermediary and the intermediary contracts with the engineer, then your beautifully drafted clause binds the intermediary. It says nothing at all about the engineer unless the intermediary's own contract does the equivalent work, under the law that governs it.

The chain has to be complete

Ownership travels in a chain, and a chain transfers nothing if any link is missing:

  • Engineer → intermediary. An assignment effective under the law governing the engineer's contract.
  • Intermediary → you. An assignment of everything the intermediary received, including the right to enforce it.

Both links must exist, and the second cannot give you more than the first delivered. A provider whose client contract promises you full ownership while its engineer contract is silent has promised you something it does not have. This is the single most common gap, and it is invisible until the moment it matters — which is typically during diligence on a funding round or an acquisition, at the worst possible time.

So the practical test is simple: ask to see both contracts, not a summary of them. Any provider that will show you only its own client paper is answering a different question from the one you asked.

Things that are easy to miss

Moral rights and waivers

Economic rights and moral rights are different things, and moral rights are not assignable in some jurisdictions — they can only be waived, and sometimes not even that. For software this rarely causes commercial harm, but if attribution matters to you, check that the point has been addressed rather than assumed away.

Pre-existing and third-party material

Engineers arrive with their own libraries and habits. An assignment of "all work created under this agreement" does not clean up a utility module the engineer wrote two years ago and dropped into your repository, nor does it resolve the licence on an open-source dependency they chose. You want a warranty that contributed material is either original or properly licensed, and a practical rule about what may be brought in.

Work produced outside the engagement

If your engineer contributes to an open-source project at the weekend, that is theirs. Sweeping clauses that claim everything created during the whole term, in or out of working hours, are both unenforceable in places and a reason good engineers decline the contract. A narrow clause tied to the services is stronger because it survives.

Enforcement is not the same as ownership

Owning a right and being able to act on it are separate. If the chain runs through an intermediary, make sure you can enforce without needing that intermediary's cooperation — companies get acquired, wound up and distracted. Ask specifically what happens to your rights if the intermediary ceases to exist.

How we structure it

Our engineer contracts assign the work to us, with the assignment governed by the law applicable to that contract, and our client contract assigns it onward to you together with the right to enforce. We will send you both sets of wording before you commit, because this is a clause your counsel should read rather than a reassurance you should take from a website.

One honest caveat: nothing above is legal advice and it is not a substitute for your own. Cross-border IP is a specialist question, and the reason we put the documents in front of you early is precisely so somebody qualified can look at them before there is any code to argue about.

A practical order of operations

In the sequence that avoids rework:

  • Ask for both contracts before a shortlist, not after an offer.
  • Have your counsel read the two assignment clauses side by side.
  • Settle the pre-existing-material rule before the first commit lands.
  • Scope repository access deliberately from day one — narrow access limits how much of your estate is ever in question. That is covered in export control when your AI engineer is in China.

Handled at the start this is an afternoon of your solicitor's time. Handled at the end it is a diligence finding, and those are expensive in a way that afternoons are not.


This is one of 6 guides supporting our main page on hiring remote Chinese AI engineers, which covers rates, the engagement model and how a placement actually starts.

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