How Kenyan Entrepreneurs can Legally Safeguard their Mobile App Idea

Kenya is growing fast as a technological hub within Africa, which has led to it being nicknamed the Silicon Savannah. As entrepreneurs seize opportunities to start businesses and innovate online, we are seeing the proliferation of a wide range of mobile apps developed and operated by Kenyans that are now available on well-known digital distribution services such as Google Play Store and App Store.

Those looking to develop and manage mobile apps should be aware of several legal considerations that would enable them to establish and run a successful mobile app business.

Safeguarding the “idea” for the App

The genesis for development and operation of the mobile app normally arises when you (as the entrepreneur) produce the idea for the application. Once the idea has been formulated, you then approach a software developer who will assist you to turn the idea into an app. Because of the risk that your idea can be used by their developer to develop their own business, it is advisable for you to insist that the developer first sign a non-disclosure agreement to protect the confidentiality of the idea so that it is not disclosed to a third party or used by the developer for their own personal benefit.

Note that in cases where an idea is developed by your employee during employment and using your resources, then the employment contract should provide for ownership rights to the idea to belong to the employer and not the employee.

Establishing the Right Structure for Your Business

A key aspect of app development is establishing the right business vehicle for your business. You may be operating on your own or working in partnership with like-minded people and you therefore need a structure that works for you or your group. If you are in business alone, then you could choose to operate as a sole trader under a registered business name or set up a one-man limited liability company. Where you are two or more partners then the options for an ideal business model include limited liability partnerships and limited liability companies. Each of these options presents risks and rewards: for example limited liability entities protects you from claims above the amount of contribution you make to the business while sole trader businesses are less expensive to own and maintain.

Key Documentation for App Developers to Consider

When the App is in the process of being developed, you will need to put in place certain documents such as:

  • a Software Development Agreement to govern your relationship with the App developer during the App development process and provide for obligations of each party, including timelines, payment provisions and dispute resolution mechanisms; and

 

  • a Technology Assignment Agreement to assign or transfer the rights of the App developer in the intellectual property of the app to you once the developer has produced it. 

Privacy and Data Protection Considerations

You should be aware of any local or international data protection laws such as European Union’s General Data Protection Regulation or Kenya’s Data Protection Act 2019 which may affect or have an impact on how you use your customer’s personal data. It is important to note that personal data collected in Kenya should be processed in accordance with the right to privacy and no personal data should be transferred outside Kenya unless there is proof of adequate protection of the customer data and the personal data has to be adequate, relevant and limited to what is necessary in relation to the purpose for which it is proceed. In case you will be collecting personal data, it is important to have a privacy policy in place to inform customers of the type of data you may have access to and get their consent to the use of such data. In addition, terms and conditions should be set out in your policy stating when and how third parties may use the app which should also contain appropriate limitations on legal liability for damage, loss or injury arising from the customer’s use of the app.

Protecting Intellectual Property Rights

Once the app is completed and ready for the market, you should ensure that your intellectual property rights to the app are protected to enable you to enforce your rights to if they are infringed by a third party acting innocently or maliciously.

Some of the forms of legal protection available in Kenya include:

  • Trademark registration protects the name or logo of the app from use by third parties. It provides exclusive ownership in Kenya of the name or logo and helps keep off potential infringers who would be tempted to ride on the goodwill of your trademark. 
  • Patent registration creates an exclusive right for the protection of an invention. To be granted, the invention must be new, capable of being used in industry and not obvious. 
  • Copyright registration protects the app’s source code, graphics and text once the work is recorded in a permanent form. The process of registration in Kenya is voluntary though it is advisable to register as it constitutes evidence of copyright ownership.

 

A well thought out legal strategy in the app development process will help you minimize your legal risks and protect your intellectual property rights thus minimizing your liability and helping your business to succeed in the digital marketplace.

Anne Mumbi

She holds a Bachelor of Laws Degree from Riara University and a Post Graduate Diploma in Law from the Kenya School of Law. 

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