IP due diligence in Ukraine
Intellectual property frequently represents a material share of enterprise value, particularly in technology, pharmaceuticals, FMCG and creative sectors. For international buyers, investors and acquirers looking at Ukrainian targets, or for Ukrainian companies preparing for a cross-border transaction, rigorous IP due diligence is what translates a stated asset list into a defensible commercial position. It is also, in our experience, where most deals encounter their first real surprise.
ADVANCE PARTNERS IP LAW FIRM conducts IP due diligence on behalf of strategic and financial buyers, sellers preparing for sale, investors at Series A through growth stage, and companies undertaking internal IP audits. We operate as Ukrainian IP counsel alongside foreign law firms in cross-border transactions, and independently where local IP depth is the primary requirement.
What IP Due Diligence Covers
IP due diligence is a structured review of the target company's intangible asset portfolio and the legal relationships supporting it. The work verifies what the target actually owns, whether those rights are in force, what obligations attach to them, and what exposures may affect their value post-closing.
Objectives
- Ownership verification: confirming the target genuinely owns the asserted IP assets
- Validity and subsistence: confirming registrations are in force and maintenance obligations are current
- Risk identification: pending disputes, third-party claims, potential infringement exposure
- Contract review: inbound and outbound licences, assignments, restrictions on use
- Value assessment: realistic appraisal of the commercial strength of the portfolio
Transaction Contexts Where IP Due Diligence Is Essential
Scope of Review by Asset Class
IP due diligence covers every category of intangible asset that bears on transaction value. The depth of review in each category is calibrated to the sector of the target and the commercial priorities of the client.
Trademarks
- Registered trademarks in Ukraine and abroad
- Pending applications
- Unregistered marks in commercial use, including common-law rights in relevant jurisdictions
- Domain names and their alignment with the trademark portfolio
- Trade names and commercial designations
Patents, Utility Models and Industrial Designs
- Invention patents and utility models
- Patent applications at various stages of prosecution
- Industrial designs
- International applications under the PCT
- Know-how and technical documentation
Copyright
- Software and source code
- Website content and marketing materials
- Product and packaging design
- Databases
- Technical and training documentation
Trade Secrets
- Confidential information and know-how
- Manufacturing processes and formulations
- Customer databases and commercial intelligence
- Confidentiality policies and procedures
Review Work Streams
Ownership and Chain of Title
The central question: does the target genuinely own what it claims to own?
- Chain of title: tracing rights from creation through every subsequent transfer to the current holder
- Author and inventor rights: reviewing agreements with employees and contractors governing rights transfer
- Service works and service inventions: validating the legal basis for employer ownership
- Assignment agreements: reviewing completeness and enforceability
Validity and Subsistence
- Registration status: whether registrations remain in force and fees are paid up to date
- Terms and renewal deadlines: expiry dates and renewal actions required
- Territorial coverage: adequacy of coverage in commercial markets of interest
- Scope of protection: Nice classes for trademarks, claim scope for patents
Licences and Contractual Arrangements
- Inbound licences: rights received from third parties (technology, software, content)
- Outbound licences: rights granted to third parties and the restrictions they impose
- Restrictions and encumbrances: exclusivity, territorial limits, sub-licensing rights
- Transferability: whether the contracts permit transfer of rights in connection with an M&A transaction
Disputes and Exposure
- Active disputes: ongoing litigation, demands and opposition proceedings
- Potential conflicts: similar third-party marks, exposure to non-practising entities
- Third-party infringement: freedom-to-operate analysis where commercially material
- Invalidity exposure: grounds on which the target's registrations may be challenged
Due Diligence Process
Workflow
- Scoping: defining review scope, executing the NDA, preparing the checklist
- Information gathering: document requests, data room access, interviews with key personnel
- Register searches: UANIPIO, WIPO, EPO, USPTO and relevant national offices
- Document analysis: agreements, certificates, patents, corporate records
- Risk assessment: classification of findings by severity
- Report preparation: written report with findings and recommendations
Standard Document Checklist
Common Risks and Findings
IP due diligence typically surfaces issues material to deal value, and occasionally issues material to whether the deal proceeds at all. The categories below capture what we see most often in Ukrainian targets.
Ownership Defects
- Missing transfers from creators: technology companies frequently lack properly executed assignments from developers
- Incomplete service-work documentation: employment contracts without IP-allocation clauses
- Contractor gaps: outsourcing contracts failing to effectively transfer IP to the client
- Joint ownership: absence of clear arrangements between co-owners
Registration Issues
- Lapsed maintenance: registrations forfeited for non-payment of fees
- Wrong owner: marks registered in the name of an individual rather than the operating company
- Coverage gaps: absence of registrations in key jurisdictions or classes
- Non-use exposure: trademarks vulnerable to early termination for any continuous five-year period of non-use following publication of the grant
Contractual Exposure
- Change-of-control clauses: licences that prohibit or restrict transfer on an M&A transaction
- Over-broad exclusive licences: excessive rights granted to third parties
- Unaccounted obligations: unpaid royalties, unperformed licence conditions
Dispute Risk
- Third-party infringement: the target's products may infringe others' patents
- Competitor claims: unresolved trademark disputes
- NPE exposure: potential claims from non-practising entities
The Due Diligence Report
The written report is the product on which the client's transaction decision is based. It must be usable by deal principals, not a legal research document.
Report Structure
- Executive summary: key findings and recommendations at deal-principal level
- IP asset inventory: full list with status of each asset
- Ownership analysis: findings on chain of title
- Contract analysis: review of key licences and their terms
- Identified risks: classified findings (critical, material, minor)
- Recommendations: specific remediation steps
- Appendices: source documents, tables, charts
Risk Classification
Types of IP Due Diligence
By Instructing Party
- Buyer due diligence: conducted on the buy-side to assess acquisition risk
- Vendor due diligence: conducted by the seller to prepare for sale and support valuation
- Self-audit: internal review to put the IP portfolio in order
By Scope
- Full scope: comprehensive review of all IP assets
- Limited scope: focused review of specific assets or jurisdictions
- Red-flag review: rapid review designed to surface critical issues
By Sector
IP due diligence is sector-specific. The priorities and high-risk areas change meaningfully depending on the target's industry:
- Pharmaceuticals: active pharmaceutical ingredient (API) patents, regulatory data exclusivity under Ukrainian medicines legislation, patent-term extension where available under Ukrainian patent law, and SPC positions in EU target markets
- IT and software: copyright in source code, open-source licence compliance, patents covering technical solutions implemented in software (as opposed to the program as such)
- FMCG: trademarks, packaging design rights, trade secrets (recipes and formulations)
- Manufacturing: process patents, industrial designs, know-how
Internal IP Audit
Beyond transactional work, IP due diligence has substantial value as a standalone exercise. Companies preparing for scale-up, market expansion or a fundraising round benefit from putting their IP house in order before counterparties start asking questions.
Internal Audit Objectives
- Inventory of all IP assets held by the company
- Verification of the documentary basis for ownership from employees and contractors
- Identification of protection gaps
- Portfolio rationalisation (abandonment of non-strategic registrations)
- Deadline monitoring system build-out
Audit Deliverables
- Comprehensive IP asset register with current data
- Remediation plan addressing identified defects
- Recommendations for expanded protection
- Template agreements for future proper rights capture
Why Choose ADVANCE PARTNERS
Our Credentials
- Recognised expertise: recommended by Legal 500, WTR 1000 and IP STARS
- Transactional experience: involvement in major M&A and investment deals
- International network: partners in over 90 jurisdictions for foreign IP verification
- Sector depth: pharmaceuticals, FMCG, technology, manufacturing
- End-to-end service: from diagnostic review through to remediation
- Confidentiality: strict NDA observance and professional secrecy
Our Services
Frequently Asked Questions
How long does IP due diligence take?
Timelines depend on scope. A red-flag review typically takes one to two weeks, while a full-scope IP due diligence runs approximately four to eight weeks. Large transactions with complex portfolios across multiple jurisdictions may require longer timelines.
Should the buyer or the seller commission IP due diligence?
Historically, buyers commissioned the work (buyer due diligence). Increasingly, sellers commission vendor due diligence ahead of a sale process to identify and remediate issues in advance, support valuation and reduce time-to-close.
What happens when due diligence uncovers an issue?
Options depend on severity. Common outcomes include price adjustment, conditions precedent requiring pre-closing remediation, specific indemnities in the SPA, escrow arrangements to cover identified exposures, and, in the case of critical findings, deal termination.
Is IP due diligence worthwhile for smaller transactions?
Yes, particularly where IP is central to the target's business. For smaller deals, a red-flag review focusing on the most material assets and risks is often sufficient and proportionate.
How is confidentiality managed?
An NDA is executed before any substantive work begins. All documents are handled via a secure data room. Our engagement is bound by both the NDA and the professional secrecy obligations applicable to Ukrainian attorneys.
Can IP due diligence be conducted remotely?
Yes. The majority of our work is carried out remotely, including data room review, electronic register searches and video conferences with target management and counsel. Remote delivery is particularly efficient for cross-border transactions involving multiple jurisdictions.
What does the IP due diligence report contain?
A typical report contains an executive summary for decision-makers, a complete IP asset inventory, ownership and contract analysis, classified risks and specific remediation recommendations.
Can foreign buyers engage ADVANCE PARTNERS directly or do they need to work through lead counsel?
Both models are common. We work directly with strategic and financial buyers and with in-house M&A teams, and we also act as Ukrainian IP specialist counsel alongside lead deal counsel. We adapt workflow and reporting to fit the deal structure and client preference.
Planning an M&A transaction, an investment round or an internal IP review?
Our IP due diligence team will scope the work, execute it against a practical timeline and deliver findings designed for decision-makers, not a research archive.
Request a consultation and we will respond within one business day to discuss scope and timing.
REQUEST A CONSULTATION
Do you need advice on registration, protection or maintenance of intellectual property rights?
Contact our team to discuss your request.
