How to Develop an App: The Legal Issues [Infographic]

Last updated: 8 August 2023

How to Develop an App is a hot topic on the Internet. Lots of guides have been written about what a great business selling Apps is; how to market your App on the Apple and Google App Stores; even guides to coding your first App. But no one, until now, has covered mobile app development Contract & Legal issues.

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Here’s a video explaining the legal issues involved in developing an App

Video transcript …

Have you got a great idea for an App? Have you thought about any of the legal aspects of it?

The use of mobile apps is increasing at a dramatic rate. You may be building an app that offers new ways to do business (like payment and purchase scanning) or you have a genius idea for a brand-new service. Maybe your business will be your App and you will manage all your customers and services through it. But there are a number of legal issues you need to consider before your App goes viral.

To help App inventors and developers, we designed this simple Infographic to explain what you should be thinking about in the development process and how to protect yourself. Just follow the blueprint and each step tells you what you should include to protect you and your App idea.

1. Use a Confidentiality Agreement to protect your App idea

First you need to make some decisions and do some research to ensure your App idea is not already out there. Decide if your App will be iOS or Android. Whether it will be a free or paid App? And whether you will seek funding from investors.

This is where the legal issues begin to arise. When you are trying to discuss anything about your idea with anyone, investors for funding, developers, friends or business colleague – you should always consider a Confidentiality Agreement. Even a basic one. App Developers and investors are familiar with signing Confidentiality Agreements, so most should not have a problem doing so prior to any discussions about your App idea. This also shows how serious you are about protecting your idea.

Too often ideas are easily taken and copied – or someone may even publish, tweet or post on their Facebook site. This means you may have difficulty ever proving your ownership. At least with a Confidentiality Agreement (which is also called a non-disclosure agreement) you can show it was your idea and in some cases, you can seek damages for any breach of confidence.

2. Ensure you have evidence to protect your Copyright

Sketch a mockup of your App design, idea and functionality. This is necessary for a number of reasons including, and most importantly, it gives evidence that it was your idea and proves ownership for Copyright reasons. If you can show it was your idea first, you don’t even need to register anything, you only need to be able to show that you had the idea, functionality and design first. Your sketch design will help evidence this.

Also, it’s a great way to help brief your App Developer. He will better understand what you are trying to get him to help develop. But remember, if you created and developed the App concept while you are at work, or under the employment of a business as part of your duties, you may not own the App even if you can show it was your idea.

3. Use an App Developer Contract when you hire a developer

Next, you need an App developer to code your App idea. When you are looking for and speaking to prospective developers, to find the right one to manage your project, make sure you use your Confidentiality Agreement. When you do find one you are happy with, make sure they sign your App Developer Contract. Most App developers do not pass ownership of the final code to you, so you don’t really own the App!

This may also lock you into using this particular developer for any updates to your App or any functionality changes. You will also have trouble getting investors if you cannot show you fully own the App code, rather than just a licence to it given by your developer.

An App Developer Contract doesn’t just protect you, it’s also good protection for your relationship with your developer as you are making clear both your and their expectations for the project, the timeline and the costs. All of which makes the understanding and relationship clear. Your App Developer Contract should also contain a Confidentiality clause. You don’t want him leaking the App idea before its done and in the market.

4. Protect your App IP with trademark registration

Now that your App development is underway, you can start planning your marketing strategy. Before your App is in the public domain, you should consider formal Intellectual Property protection. To protect the name and logo you can register the Trademark with IP Australia. It can be a quick online process once you have completed all the searches and know the classes to choose.

Additionally, if your App has unique functionality, it’s important to consider protecting this by registering the Patent. You can do this with IP Australia too and it will go a long way to protecting your App from being copied by someone trying to do something similar.

5. Make sure you have the right App legals

The last and most important item in your App development process is your App legals. Now that your App is ready to go, decide what store you want to release it on – maybe the App Store if it’s iOS or Google Play Store if it’s an Android App. And it’s a good idea to have your own website where people can go to see the functionality, videos of your App, ask questions and even purchase directly from the site.

The terms of use for the App are important. They protect you and your business. Believe it or not, and this may come as a surprise, but the legal terms you agree to in the Apple and Google stores do not protect you – they protect Apple and Google. And they put all the legal risk on you! You are agreeing to indemnify them from any of your customers who are unhappy or experience problems or issues. If something goes wrong, you are on the hook.

But if you have your own Terms of Use and ‘EULA’, that your App users agree to when they download, you will go a long way to protecting yourself and your business.

What if your developer makes the App access the users’ contacts when it doesn’t need to and they are released to other people by accident? Without knowing what your App needs to run, you may find yourself in trouble. Ensure you first check with your developer and know what they have coded into your App. Many developers do not limit permissions to the minimum required as it is more work for them to do so. This means you could be accessing information your App does not need to run.

So make sure you know what you need to run your App so you are not exposed to claims that you are accessing and using information, especially personal information you don’t require.

A Privacy Policy will also help clarify what you do with any information you may access and give confidence you keep that information secure. If you also include a Disclaimer that users agree to, it can limit your risk of the App not working properly or being misused. You need to consider your App as a product that people can sue you for, even if they misuse it. Without clear terms on what you are responsible for, there is little you can point to, to protect yourself.

6. Lastly, promote your App

And now you are ready to promote your App. Don’t forget to promote it on all the Social media outlets available – it’s a great way to get your message out there. Your App may require a few updates and once you have followers on your list, this may be a good (and inexpensive) way to let them know the next version is available.

We hope you found this guide on how to develop an App and launch your App business helpful.

About the Author: Vanessa Emilio

Vanessa Emilio (BA Hons, LLB, ACIS, AGIA) is the Founder and CEO of Legal123.com.au and Practice Director of Legal123 Pty Ltd. Vanessa is a qualified Australian lawyer with 20+ years experience in corporate, banking and trust law. Click for full bio of Vanessa Emilio or follow on LinkedIn.

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