OEM Agreements & IP Protection

Your product. Your moulds. Your designs. Clearly owned, properly protected, enforced in China.

Who This Service Is For

Developing a custom product with a Chinese manufacturer
Paying for moulds, tooling, or product development work
Creating a private-label or OEM brand
Concerned about who owns the designs, prototypes, and improvements the factory creates
Preparing to move from sampling to volume production
Planning to manufacture with multiple factories and need a reusable contract framework

The Five Questions Every Custom Manufacturing Project Must Answer

Who owns the moulds and tooling?

You paid for them — but does the agreement say so? Ownership, physical marking, maintenance, retrieval rights, and lien waiver must be stated expressly.

Who owns the designs and development work?

Under Chinese law, commissioned inventions default to the party that completed the work — the factory. A vesting clause must reverse this before development begins.

Who owns improvements?

If the factory modifies your design or improves the process, who can use the result? Joint ownership leaves the factory free to keep exploiting and licensing.

Can the factory make similar products for others?

Category-specific exclusivity, restrictions on over-production, and ghost-shift deterrence must be built into the agreement.

What happens when the relationship ends?

Mould return, destruction of materials, sell-off periods, survival of confidentiality — a clean exit must be designed in advance.

The Contract Stack

Depending on your project structure, we prepare the following documents:

1. NNN Agreement	Protects confidential information, prevents unauthorized use and circumvention
2. Development / Tooling Agreement	Ownership of prototypes, improvements, moulds; development milestones and fees; risk allocation
3. OEM Manufacturing Agreement	Production licence, specifications, quality standards, pricing, delivery, termination, dispute resolution

For single-factory projects with moderate development, the development and tooling provisions can be incorporated directly into the NNN agreement — one document instead of two, reducing legal costs.

Fees & Timeline

NNN + Development Provisions

Fixed-Fee Options Available

15–20 pages · single factory · 5 business days

Best for: early-stage, one factory, moderate customization

NNN + Tooling + Manufacturing

Tailored Proposal

Three agreements · phased: NNN+tooling first, manufacturing after sample approval

Best for: custom product development, volume production

Full Stack (Multi-Factory)

Tailored Proposal

NNN master + per-factory copies + development + manufacturing agreements

Best for: multi-supplier comparison, complex projects

Phased payment structure available. Entity verification and chop guidance included in all tiers. Contact us to discuss your project and receive a tailored proposal.

Why Timing Matters: The Cost of Waiting

Under Chinese patent law, the right to a commissioned invention belongs to the party that completed the work — your factory — unless your agreement says otherwise. This ownership is determined the moment the work is completed, not when you sign the manufacturing agreement. If you wait until after the factory has developed your prototype to negotiate IP ownership, you are negotiating to buy back what has already defaulted to them.

The same principle applies to exclusivity: before the product succeeds, the factory will readily accept ownership and exclusivity terms in exchange for the order. After it succeeds, the price of those terms rises sharply — or the option disappears entirely.

How OEM and NNN Agreements Work Together

The two documents serve complementary purposes:

NNN agreement — protects information: what the manufacturer cannot disclose, use, or circumvent
OEM agreement — governs the manufacturing relationship: production obligations, quality, pricing, delivery, ownership of moulds and improvements

The documents must be coordinated: consistent definitions, no conflicting obligations, no gaps in protection. We prepare them as an integrated stack, not as isolated documents.

Frequently Asked Questions

If I pay for the mould, does that mean I own it?

Not automatically in every relevant sense. The agreement should expressly address ownership, physical marking, maintenance, storage, access, retrieval, and the consequences of termination. Without a lien waiver, the factory may hold your mould hostage over any alleged dispute.

Does owning a mould mean I own the product design?

No. Ownership of a physical object and ownership of intellectual property are distinct. The agreement should address each separately — tooling ownership for the physical mould, IP ownership for the design it produces.

Who owns improvements developed by the manufacturer?

Under Chinese law's default rules, improvements belong to the party that made them — the manufacturer. The agreement should vest improvements in you upon creation, or grant you a non-exclusive, royalty-free, perpetual licence (a "grant-back") as a minimum.

Should the OEM agreement be signed before product development?

The development ownership provisions must be in place before development begins — but the full manufacturing agreement (pricing, quality, delivery) can wait until after sample approval, when unit costs and specifications are known. A phased structure (NNN + development first, manufacturing later) optimizes both protection and cost.

Can you review an OEM contract the factory sent me?

Yes. A review can identify issues in the factory's proposed terms. If significant, we would recommend replacing rather than annotating the factory's document — contracts drafted by the other side rarely serve your interests adequately.

Protect the value you are building into your product.

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