Varun
in Corporate Law Contracts Law Competition Law
Asked April 25, 2014

Relevance of Acquisition Agreement

  • 1 Answer
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Hey there, I am a business owner and my company is in the process of acquiring another company. What I want to understand is that , what happens with the intellectual property of the acquired company such as trademark, copyright etc can that be transferred from one entity to another

Answer 1

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Asmita Rakhecha

While acquiring a company, all assets and properties of the selling company is acquired by the buying company. Section 394 of the Companies Act 1956, provides for the procedure to be followed in case of amalgamation of companies. It provides that property which is to be transferred includes ‘property, rights and powers of every description’. Hence Intellectual Property such as Copyright, Trademark, Patents, etc. also being a property, is deemed to be transferred in case of acquisition of companies. However, in most cases it is observed and advised that the selling company either transfer the copyright or grant the license of the Copyright of such company to the buying company to avoid legal disputes in the future.

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