The emergence of non-fungible tokens (NFTs) in South Africa, like in other countries, presents distinctive challenges and opportunities in the way we perceive and manage IP rights, particularly with regard to trade marks and copyright.
This article explores how NFTs interact with trade marks and copyright within South Africa, delving into the legal considerations that arise when these worlds converge.
This article forms part of a series of articles covering NFTs which will be featured under Latest News & Insights.
NFTs are unique digital assets that represent ownership or proof of authenticity of a specific item or piece of content, often using blockchain technology. They can include digital art, video clips, audio files and even tweets.
Unlike cryptocurrencies like Bitcoin or Ethereum, NFTs are non-fungible, meaning each token has a distinct value and cannot be exchanged on a one-to-one basis, making them one of a kind.
IP Law and NFTs
South Africa has a robust legal framework for protecting intellectual property (IP), including copyright and trade marks.
Trade marks are distinctive signs, names or symbols used to identify and protect goods and services in the marketplace. Generally, any sign that is capable of distinguishing an item and can be represented graphically can be registered as a trade mark.
In order to benefit from the maximum protection under South African law, trade mark owners should ensure that their trade marks are protected in the correct classes and registered with the Companies and Intellectual Property Commission.
The proliferation of NFTs featuring trade marks without proper authorisation can have detrimental effects, including brand dilution, damage to brand identity, and consumer confusion.
Copyright provides legal protection to original creative works, including literature, music, art and software, once they are fixed in a tangible form. Copyright owners have exclusive rights to reproduce, distribute, perform and adapt their works.
Copyright protection is automatic upon the creation of a qualifying work and generally lasts for the lifetime of the author plus 50 years. While copyright is automatically conferred upon the creation of an original work in South Africa, creators may still opt to register their works in other jurisdictions for added protection, especially if they plan to tokenise them as NFTs.
The decentralised nature of NFT platforms can result in unauthorised tokenisation of copyrighted works, posing a risk to the IP rights of creators. Preventing the unauthorised tokenisation, use and distribution of copyrighted material is challenging due to the ease with which digital content can be copied and minted as NFTs.
The advent of NFTs in South Africa introduces a novel layer to the already intricate landscape of intellectual property law. These unique digital assets, while offering exciting opportunities for creators and collectors alike, also usher in a myriad of legal challenges, especially concerning copyright and trade marks.
As NFTs continue to gain traction, it becomes paramount for stakeholders to be well-versed with the country’s robust IP framework. To navigate this evolving terrain, trade mark and copyright holders should be proactive in safeguarding their rights, ensuring proper authorisation and taking steps to mitigate potential brand and content infringements.
As we delve further into this series, we aim to equip readers with the insights needed to adeptly manoeuvre through the intricate junction of NFTs and intellectual property in South Africa.