This article is the first part of a three-part series examining employer and employee IP rights under Maltese law.
1. Introduction
Intellectual Property (“IP”) has become an increasingly vital asset for organisations that rely on innovation, data and technology in their operations. As a result, IP ownership rights between employers and employees have become a risk-management issue. Employers are placing more importance on IP ownership by ensuring that clear ownership and assignment clauses are included in employment contracts.
However, what happens when employees create IP (such as software and creative works) outside normal working hours or where the work appears unrelated to their role within the organisation?
2. The Maltese Legal Framework
In Malta, IP rights are governed through laws such as the Copyright Act (Chapter 415 of the laws of Malta) and the Patents and Designs Act (Chapter 417 of the laws of Malta), complemented by EU regulations, directives and case law. Employment contracts, confidentiality agreements, and internal IP policies operate alongside this legal framework.
Maltese law distinguishes between different categories of IP, such as: works protected by copyright, trademarks, designs, databases, software, trade secrets and patentable inventions. Ownership rights and registration of such ownership vary depending on the type of work created. Unlike inventions which need to be filed at the Office of the Comptroller, in order to obtain a patent, copyright protection is obtained automatically, as soon as a work is created, without the need for registration.
For this reason, employers in Malta should consider both applicable legislation and the contractual terms agreed with employees when determining ownership of such IP rights.
3. The Default Position: Who Owns Employee-Created IP?
Article 11 of the Copyright Act establishes the default position in Maltese copyright law. First ownership of works eligible for copyright, such as literary[1], musical, artistic[2] or audiovisual works, vests in the author or joint authors. In this case, employers must therefore rely on clauses in the employment contract to obtain ownership of such works. If ownership is not assigned by the employee to the employer, the employee remains the initial copyright owner for these works, even if produced during working hours or using employer resources.
However, Article 11 creates two important exceptions to this default position.
Where a computer program is made in the course of the author’s employment, in the execution of his/her duties or following instructions given by the employer, the economic rights conferred by copyright shall be deemed to be automatically transferred to the employer, unless the parties explicitly agree otherwise.
The same presumption applies to databases[3] created in the course of employment or under employer instructions.
Thus, in the case of both software and qualifying databases, the employer is presumed to be the owner.
Article 11 of the Patents and Designs Act also confirms that the right to patent an invention made in the execution of a contract of employment shall belong to the employer, unless the parties agree otherwise, in writing.
Despite the abovementioned presumptions, stemming from the Copyright Act and the Patents and Designs Act, it is highly recommended that employers still include IP assignment clauses for clarity, especially where the same employee may produce different types of copyright-protected works. Legislation may have simplified ownership for computer programs, databases and patentable inventions, but it does not eliminate the need for contractual clarity covering all other works produced by the employee.
4. Scope and Effectiveness of IP Assignment Clauses
To secure ownership of IP created by an employee, Maltese employers typically include assignment clauses in employment contracts. These clauses generally cover:
- Assignment of rights[4]: Employees agree that IP created during their employment or while using employer resources, is owned by the employer. This may include both current and future works;
- Waiver of moral rights: While moral rights are non-transferable under Maltese law, employees may agree to waive such rights;
- Confidentiality obligations: Employees are obliged to keep trade secrets and other proprietary information confidential during and after termination of employment;
- Duty to disclose inventions: Employees must promptly inform the employer of inventions or innovations relevant to the business, enabling patent protection or commercial exploitation.
The IP clauses in employment agreements should therefore ensure that employees are clearly informed of their IP obligations and that the scope is reasonable and linked to the employee’s role and use of company resources. Overly broad clauses claiming unrelated personal work or imposing indefinite restrictions are unlikely to be upheld under Maltese law. Well-drafted contracts, supported by internal policies, help safeguard IP, while also reducing the likelihood of disputes.
[1] Literary works may include written materials, reports, memoranda, documentation, as well as training or marketing content.
[2] Artistic works may include designs, illustrations and graphics
[3] Databases qualify for copyright protection only when they constitute the author’s intellectual creation, due to an original selection or arrangement of its contents.
[4] An assignment of copyright shall be effective if it is made by means of a written agreement
The information provided in this Insight does not, and is not intended to, constitute legal advice. All information, content, and materials available are for general informational purposes only. This Insight may not constitute the most up-to-date legal information and you are advised to seek updated advice.
