In this short piece, we’ll be focusing mostly on ownership of digital assets. Given the problems faced by owners of digital assets nowadays, analysing the pros & cons of different organizational & legal forms may prove to be highly beneficial for them.
Registration of Digital Asset Ownership
Registration of digital asset ownership in the US or EU depends on:
- whether these assets are new (not yet created);
- whether they’ve already been acquired & are in personal possession.
New digital assets are easier to plan because then ownership can be structured as profitably as possible. If the rights to digital assets have already been issued, then some restrictions are possible.
Who Can Own Digital Assets?
Sometimes, determining digital assets ownership in Europe or Asia can be a big challenge. And that’s where terms of the service agreement come to rescue. For example, when creating an email account, people usually enter their first & last name. But what if they have to create an email account for an organization or trust? Determining the owner is vitally important for protecting property rights to digital property in the EU or US. And given the fact that a company has invested a lot of time & money into a specific digital asset, ambiguity in terms of property rights is simply unacceptable.
Service Agreement Terms
Let’s say, you need to understand what happens to a digital asset after a person passes away. Will all their information be deleted after their death? Who can get rights to a digital asset?
Protecting the ownership of a digital asset in Europe and America requires creating an entity responsible for storing that digital asset. It should be organized in such a way as to prevent occurence of any access-related problems in the future. Someone (i.e. shareholders, LLC managers, partners or managers) will always be able to gain access to the information, regardless of whether the beneficiary has passed away or not.
However, such an opportunity (i.e. creating an organization or trust in the EU or US) must be provided for in the service agreement. Any violation thereof may result in an account being closed or access being denied.
Managing a Digital Asset in the EU or US
After a person dies, all information related to their account becomes unavailable. In this day and age, the prevalent approach is that the account is a non-transferable unit; therefore, it can be transferred neither to a trust, nor to an object. Virtually any transfer of ownership rights to information in the EU or US would be considered as violation of the service agreement.
If you’re creating an account for a trust that was established yesterday, Google will ask you to specify your date of birth to make sure you’re an adult. And if you hit “yesterday,” the account will most likely not be created. Email services providers simply do not consider the fact that the rights to digital assets can belong to an organization or a trust. Therefore, to handle that predicament, you can use the data of the LLC manager or partner to specify the date of birth (however imperfect that solution may be).
Today, you can find many solutions that can help you protect rights to digital assets in the EU or US. However, what you need to understand is that digital rights are an entirely new phenomenon, which is why there aren’t many legal precedents involving their management. Should you need to plan the management of digital assets in the US or EU, ordering legal advice with IQ Decision UK would be the best solution. Our experts will be happy to help you solve any problems related to ownership of digital assets in the EU or US.