8 Legal Issues 2021 to Consider in Your Mobile App Development

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There is no doubt about the fact mobile app development is a very profitable niche. The reason for this is very simple; mobile apps make it very easy for businesses to get in direct contact with the users.

Apart from this interaction, businesses are gaining profits from providing users with everything at their doorstep.

Do you want to order a ride? Go ahead and call an Uber or Careem. Want to have food and can’t go out? Perfect! Grab your phone and order your favorite meal via Food Panda. These apps and so many more are the reason why it is projected that the revenue from mobile apps will be around $188.9 billion by the end of this year.

Just like any other field, the app development agency is also faced with many legal constraints and requirements. Even though the entry is easier as compared to other fields, it does not mean that there are no legalities involved.

The legal considerations need to be kept in mind for running the business successfully. Big misconception businesses have is that the legal handlings are the responsibility of the app development firm they have hired to develop their app.

The top of the line firms do offer to tackle the legal side of the development process, but there is an extra fee for that. Moreover, from the moment you get an idea or come up with the name of your app, you need to trademark it. Otherwise, someone else can take the same name and own it legally.

When Should We Think About the Legal Aspects of App Development?

One question that gets thrown around a lot is when is the right time to consider the legal side of mobile app development? What stage does it start from?

The honest answer is to start from the beginning. As soon as you get an idea and finalize it, it is time to legally protect it. If you haven’t legally protected your idea, anyone can come up and take so-called inspiration from it and steal it.

Not only this, government laws and restrictions also come into play. Content that is legal and okay (even appreciated in one country) may be penalized by the government of the other country. So, it is very important to look into the legal aspect as soon as possible.

If you ignore the legal implications and continue developing your app, it is going to waste so much time, effort, money and resources. Why is that so? Well, if you end up including questionable content, your app will not be published and you can end up being penalized for it.

To correct it and remove the questionable content, you will need to invest time and money in redesigning it. So why not get it right the first time?

8 Legal Issues in App Development 2021

  1. NDA
  2. Privacy Policy
  3. Data Protection
  4. Independent contact agreement
  5. Terms and conditions
  6. App store requirements
  7. Jurisdiction
  8. Limited liability

1. Non-Disclosure Agreement

An NDA (Non-disclosure agreement) is a contractual, legal document. In this, the parties involved promise to keep particular information confidential and a secret. It will not be shared with ANYONE under ANY circumstances.

The best way to benefit from it is to get it signed before you get into a contract with the other party. It is the best way in which you can protect the IDEA of your mobile app. Multiple parties can sign it and it should be well-drafted. Take time to get it made. This confidentiality agreement is going to protect you in case one of the parties breaches the contract. So, it should be detailed and precise.

The following things need to be properly explained and taken care of before signing this particular form.

  • What confidential information should be included?

Before anyone signs a contract, it needs to be checked. Which information needs to be protected? Include the important ones like:

  • Financial data
  • Marketing
  • Business idea
  • Trade data
  • Know-how
  • Operating methods
  • App’s architecture etc
  • Obligations of the party: When making such agreements, you need to be precise. Only asking them to keep your information a secret is not enough. They need to maintain the confidentiality of the information, only sharing information to the staff if needed etc
  • Term: Define how long the contract is going to last. 2, 3 or 4 years.

Penalty in case of a breach: Add the penalty in case the other party makes a breach. It can be a sum of money or termination of contract or something like this.

2. Privacy Policy

A detailed privacy policy needs to be made. It is a legal document in which you will show how you will collect personal data from the users and how will you handle that data.

3. Data Collection

Legally, you can collect data from the users, it is allowed. But, there are a few things to take care of otherwise you can be used by the users in the context of using data wrongly. Following are the obligations of data processing:

  • Do not collect irrelevant data. Only collect data that you need.
  • Only use data for the reason you have collected it even if it is relevant to some other purpose. For instance, if you collected data to help the users open their account; do not use it for push marketing.
  • Don’t let unauthorized people access data.
  • Communication is necessary. Legally, to protect yourself keep the data provider in the loop. Document what they have allowed you to use the data for.

4. Terms and Conditions

The terms and conditions which you are going to draft depend largely on where your app is going to be published. For example, the terms and requirements of European countries include particular legal and specific issues. The following information should be included in the document:

  • Information about the company should be included in the Terms and Conditions documents.
  • You need to include information on how your application operates, what it does, age limit, conditions for deleting the account and under what conditions and how you can terminate your account.
  • Mention the technical requirements and the rules of how the accounts of users can be blocked or suspended by the app.
  • Mention the legal license under which the app should be used.
  • Mention the process of complaint management

Explain the limitation of liability

5. App Store Requirements

The app you make will be published on either Apple’s iStore or Google’s Play Store. Each store has its own set of requirements that need to be met. They have rules for data protection, health data protection, intellectual property rights etc. You should search online and see the requirements.

6. Independent Contractor Agreement

This relates to the legal contract between you and the app development agency. You need to make a contactor agreement in which you are going to specify how work will be done between the two companies.

  • You need to outline this at the beginning of the relationship between the two companies. Add the tools of communication, the procedure of meetings and how the communication will take place.
  • Include a force majeure This is important after the COVID pandemic. How will any unforeseen events mitigate between the companies?
  • Explain the exit strategy. How will the dues be cleared, what is the exit plan, are there any contractual penalties etc?
  • Consider and include other important clauses too

1. Hire Service Provider Wisely

When you outsource, the product quality depends on the team or service provider’s work efficiency.

Looking for an agency or freelance with lower rates might save you some bucks, but there is no guarantee you will get high-quality work. Hiring a professional team or person means having confidence in their work quality which helps you scale up your company. 

So, what’s the process of hiring the best software company?

  • Browse their portfolio and check the past testimonials.
  • Visit apps or websites they have worked on.

Keep an eye on user experience, design, software load timing, and mobile functionality while checking their past work.

7. Jurisdiction

Another important legal aspect is to consider the jurisdiction where you are going to launch your app. Different countries have different laws and regulations and you need to be sure you meet all of them to save yourself from legal penalty. The best way to save yourself from this is to hire a lawyer to study the market abroad. In this way, you will get information about the laws and regulations out there.

8. Limited Liability

When you are working as an entrepreneur, you get total profits. But, there is another side to the story. You also have to bear the total liability. At times, to save yourself from the hassle and tension of taking all the responsibility, it is better to change the form of ownership.

You can go ahead and become a partner with someone. There is an option of forming a limited liability company. In this, the liability of each partner is truly limited. Moreover, it has the advantage of protecting your assets. Whatever happens to the business, your assets are protected.

Conclusion

Mobile app development is a multi-faceted industry that is progressing day by day. Even though entering the industry is pretty simple, many legal obligations need to be met. We have discussed the top 8 ones today.

If the legal issues are not taking into account, you can come up with the best mobile app in the world and still not be able to publish it. So, save this guideline somewhere for future reference.

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