VERIFY THE IP
BEFORE THE DEAL
KEY FACTS
TOPIC
Commercial IP
START WITH PURPOSE
An acquisition, investment, licence, and supplier review require different depth and materiality.
OWNERSHIP
Official titles must connect to employee, contractor, founder, assignment, and group-company records.
BUSINESS FIT
A large portfolio has limited value if it does not cover the products, markets, and revenue in the deal.
OUTPUT
Convert findings into price, conditions, remediation, indemnities, covenants, or a decision not to proceed.
NEED A FIRST READ?
Send us the issue, the relevant rights, and any deadline. We will route it to the right practice lead within one business day.
Contact UsDEFINE WHAT THE DEAL IS BUYING
Identify the products, technology, brands, data, channels, territories, and people that drive the transaction thesis. Set materiality around those assets. A register review alone may confirm that patents exist while missing that the target's core product depends on third-party code, a founder-owned trademark, or know-how held by one departing engineer.
Create an asset-to-revenue map and an asset-to-product map before requesting a data room dump.
VERIFY TITLE AND CONTROL
For patents, trademarks, copyright registrations, domains, and other registered rights, confirm owner, status, scope, term, fees, pledges, licences, disputes, and recordals from official sources. Then test the chain behind the record: founder and employee agreements, commissioned work, assignments, merger documents, university collaborations, and intercompany arrangements.
For trade secrets, data, and unregistered copyright, examine access, documentation, origin, contracts, security, and evidence. Control may matter as much as formal title.
TEST VALIDITY, SCOPE, AND FREEDOM
Sample key rights based on business importance. Review patent claim coverage and prior-art risk, trademark goods and subclass gaps, design images, copyright subject matter, and geographic coverage. Compare the protected assets with the current products and roadmap.
Separately assess third-party risk: inbound licences, open-source obligations, standards, employee contamination, supplier restrictions, coexistence agreements, infringement claims, and freedom-to-operate issues.
READ THE CONTRACTS FOR TRANSFERABILITY
Identify change-of-control, assignment, sublicensing, exclusivity, territory, field-of-use, source-code access, audit, termination, and improvement clauses. A licence essential to the business may not follow the company through an asset sale or may require consent after control changes.
Check whether grants to customers, distributors, joint-venture partners, or manufacturers have unintentionally limited the target's own use or enforcement.
TURN FINDINGS INTO DEAL TERMS
Classify issues as fatal, pre-closing, price-related, indemnity-backed, post-closing remediation, or monitoring. Use specific conditions such as executing an assignment, curing a lapse, obtaining consent, filing missing marks, separating code, changing a supplier, or retaining key staff. State remaining uncertainty so the decision maker understands what the diligence did and did not establish.
OFFICIAL SOURCES
WIPO: Uncovering IP Risks and Potential through an IP Audit
This article is general information about Chinese IP practice, not legal advice for a specific matter. It was last reviewed on 2026-08-21. Rules, fees, and timelines change; confirm current requirements before acting. For advice on your situation, contact our team.