March 16, 2015

How Is Your Offshore Development Partner Providing You Legal Protection?

Mutual trust has its place in every employee-employer relationship, whether onshore or offshore.  Personal guarantees, however, in the B2B world can be strained when the people making the agreements leave the business or relationship circumstances change.  Simple misunderstandings are common in our everyday lives; why would it be any different in business?  Most of us find it helpful to rely on established processes and legal frameworks in business, and not completely on people, however well-intentioned they may be.  This leaves the all-important question: how is your offshore development partner providing you legal protection?

Two of the more important considerations for a technology business whose trade is innovation, are protecting intellectual property and guarding trade secrets.  Legal protection plays a critical role in safeguarding both of these.

Offshore partners are just that – offshore.  Their native country’s laws govern their businesses, and if an American company had to take action against their offshore partner, then they would be in unfamiliar territory.  At best, the legal fees are staggering, and at worst there is simply no legal recourse available.  It’s critically important to ensure that you can legally enforce such protection in any offshore contract.

Many offshore service providers leave companies vulnerable to the following:

  • Trade secret infringement
  • Copyright infringement
  • Intellectual property infringement
  • Code confidentiality

What happens when there is a dispute with the offshore service provider, the project goes far over budget and is a complete disaster?  What if the offshore employee simply wants your idea for themselves?  You worked hard to develop and nurture the idea; you figured out how to monetize the opportunity.  Suing for damages and realizing any real compensation is less than likely.

It is always a good idea for firms pursuing offshore talent to seek service providers that have a local presence in the U.S.  This allows for the specific legal protection of intellectual property and the enforcement of formal contracts within the U.S. legal system.  Transactional concerns such as billing, refunds, service standards and timeline accountability fall within the same set of protections.

We routinely see clients that put everything they have into the growth of their business or the development of their idea.  We see well-established businesses with an obvious need to protect the integrity of their clients’ data as well their own.  A new client recently asked, “How can I be sure that your offshore team won’t take my idea, and then I’m facing my own product as a competitor in the marketplace?”  Being a U.S.-based company, we were able to show the many ways in which we eliminate that possibility as a concern for both the client and ourselves.

How does your offshore partner protect you?

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