Rights in data: Overview, definition, and example
What are rights in data?
Rights in data refer to the ownership, control, and permitted use of data collected, created, or shared under an agreement. These rights define who can access, modify, distribute, or store data and under what conditions. They are commonly addressed in contracts involving technology, software, intellectual property, or data-sharing arrangements.
For example, a business that hires a marketing agency to collect customer analytics needs to define whether the agency retains rights to the data or if the business has exclusive ownership.
Why are rights in data important?
Clearly defining rights in data helps prevent disputes over data ownership, usage, and confidentiality. It ensures that businesses know how their data can be used and who has the authority to share or monetize it.
For SMBs, understanding rights in data is crucial when working with third-party service providers, software vendors, or cloud storage platforms. Without clear agreements, businesses may lose control over valuable data, face compliance issues, or risk unauthorized use.
Understanding rights in data through an example
A software company develops a cloud-based project management tool that collects user data for performance tracking. The company’s terms specify that it retains full rights to the data, meaning customers cannot export or resell it.
In another example, an e-commerce business hires a payment processor to handle transactions. The agreement states that the business owns all transaction data, but the payment processor has a limited right to use aggregated, anonymous data for fraud prevention and analytics.
An example of a rights in data clause
Here’s how a rights in data clause might appear in a contract:
“All data collected, stored, or processed under this Agreement shall remain the exclusive property of [Party Name]. The other party shall not use, share, or distribute such data without prior written consent, except as required by law.”
Conclusion
Rights in data define who owns, controls, and can use data in a business relationship. Clearly outlining these rights in contracts protects businesses from unauthorized use, data disputes, and compliance risks.
For SMBs, ensuring proper rights in data agreements can safeguard customer information, maintain control over business assets, and avoid legal conflicts with vendors or service providers.
This article contains general legal information and does not contain legal advice. Cobrief is not a law firm or a substitute for an attorney or law firm. The law is complex and changes often. For legal advice, please ask a lawyer.