What happens to a work’s copyright ownership if my company goes out of business?

There are two ways by which a company may go out of business:

  1. When it goes into liquidation: There are two major types of liquidation process – solvent liquidation and insolvent liquidation. Solvent liquidation usually occurs due to the retirement of a director or may be the process of closure when the company cannot further serve any useful purpose. Insolvent liquidation usually occurs when the company cannot continue to operate for financial reasons.
  2. When it gets taken over: A takeover of a company usually occurs when a larger company successfully makes a bid to acquire or assume control of a smaller company. Takeovers are commonly conducted via the process of merger and acquisition, which may be completed with a purchase of a majority stake in the target firm.

If your company goes into liquidation, the copyright ownership of a copyrighted work will be passed onto those entitled to the assets of your company (e.g. the creditors). On the other hand, if your company gets taken over by another company, the copyright ownership will be passed onto the other company.

However, there may be instances when you may need to conduct some research to find out who owns the copyright originally. For instance, if the work in question is a book, you need to ascertain whether it is the book’s author or the publisher that owns the copyright. While the copyright of a book is likely held by its author, if you find out that the publisher is the one who actually owns the copyright, the person that acquires the assets from the publisher will most likely own the copyright after the publisher goes out of business. In this case, you need to find out who has been involved in that transfer and/or contact the lawyer that has administered the publisher closure.

Key takeaways

  • If your company goes into liquidation, a copyrighted work’s copyright ownership will be passed onto the creditors.
  • If your company gets taken over by another company, a copyrighted work’s copyright ownership will be passed onto the other company.
  • However, if it is uncertain as to who originally owns the copyright, you will need to conduct research to ascertain the work’s copyright owner.