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''See also: [[copyright]]''<br> | ''See also: [[copyright]]''<br> | ||
Can I sell my client’s data? | Can I sell my client’s [[data]]? | ||
A legal distinction worth bearing in mind between between: | A legal distinction worth bearing in mind between between: | ||
*“'''[[copyright]]'''” is a statutory right which applies to certain types of information automatically, | *“'''[[copyright]]'''” is a statutory right which applies to certain types of “created” information automatically, investing in their author some proprietary rights to stop other people reproducing the creation. It does not apply to all kinds of information - the information must have been “created”. Numerical data (like execution prices) ''are not capable of protection by [[copyright]]''. You can acquire “[[database copyright]]” which derives from the effort you have taken to compile a database of execution prices. But you couldn't stop another party compiling an identical database by itself: if your counterparty itself compiles its own database of the same material, it would have copyright in its database, and you in yours. | ||
*“'''[[information]]'''” which can be any kind of information, including data. Parties can make any agreement about who can do what with any type of information, whether or not it is copyrightable. So for example, a client could say "I will only give you my business if you agree not to use any information you derive from by trade data for any purpose other than reporting to me and complying with [[applicable law]]." This is a contractual right, not a statutory one, but the client can only enforce it to the extent it can prove that it has suffered a loss. Generally that would be pretty hard to do. | *“'''[[information]]'''” which can be any kind of information, including [[data]]. Parties can make any agreement about who can do what with any type of information, whether or not they own it or whether it is copyrightable. So for example, a client could say "I will only give you my business if you agree not to use any information you derive from by trade data for any purpose other than reporting to me and complying with [[applicable law]]." This is a contractual right, not a statutory one, but the client can only enforce it to the extent it can prove that it has suffered a loss. Generally that would be pretty hard to do. | ||
*'''regulatory/legal considerations''': You cannot give non-public information to a third party if that would amount to inside information, or facilitate [[market abuse]] (e.g., front running). So if the information identifies a client somehow, especially if it allows prediction of client trading behaviour, you may have a big problem. | *'''regulatory/legal considerations''': You cannot give non-public information to a third party if that would amount to inside information, or facilitate [[market abuse]] (e.g., front running). So if the information identifies a client somehow, especially if it allows prediction of client trading behaviour, you may have a big problem. | ||
*'''reputational/franchise considerations''': Even if there are no legal, contractual, regulatory or criminal sanctions against it, if the client would be annoyed about it and withdraw their business, | *'''reputational/franchise considerations''': Even if there are no legal, contractual, regulatory or criminal sanctions against it, if the client would be annoyed about it and withdraw their business, it’s just as big a problem. | ||
{{seealso}} | {{seealso}} | ||
*[[Confidentiality agreement]] | *[[Confidentiality agreement]] | ||
*[[Copyright]] | *[[Copyright]] | ||
Revision as of 10:39, 9 January 2019
See also: copyright
Can I sell my client’s data? A legal distinction worth bearing in mind between between:
- “copyright” is a statutory right which applies to certain types of “created” information automatically, investing in their author some proprietary rights to stop other people reproducing the creation. It does not apply to all kinds of information - the information must have been “created”. Numerical data (like execution prices) are not capable of protection by copyright. You can acquire “database copyright” which derives from the effort you have taken to compile a database of execution prices. But you couldn't stop another party compiling an identical database by itself: if your counterparty itself compiles its own database of the same material, it would have copyright in its database, and you in yours.
- “information” which can be any kind of information, including data. Parties can make any agreement about who can do what with any type of information, whether or not they own it or whether it is copyrightable. So for example, a client could say "I will only give you my business if you agree not to use any information you derive from by trade data for any purpose other than reporting to me and complying with applicable law." This is a contractual right, not a statutory one, but the client can only enforce it to the extent it can prove that it has suffered a loss. Generally that would be pretty hard to do.
- regulatory/legal considerations: You cannot give non-public information to a third party if that would amount to inside information, or facilitate market abuse (e.g., front running). So if the information identifies a client somehow, especially if it allows prediction of client trading behaviour, you may have a big problem.
- reputational/franchise considerations: Even if there are no legal, contractual, regulatory or criminal sanctions against it, if the client would be annoyed about it and withdraw their business, it’s just as big a problem.