G-B7N2H7TNZP
top of page

NFTs in Intellectual Property Law



Within the scope of the Law on Intellectual and Artistic Works, "All kinds of intellectual and artistic products that have the characteristics of their owner and are considered as works of science and literature, music, fine arts or cinema" are considered as works. In accordance with this definition, three conditions are stipulated for being considered a work. The first condition is the formal condition, and the principle of limited number is adopted in terms of the types of works, and the works are counted as science and literature, music, fine arts or cinema works. The second condition is that, in accordance with the subjective condition, the person who created the work must have the work and creative spirit to create that product, in short, it must be original. The last condition which is an objective condition states that the work must be perceived directly or indirectly.


The artwork, literary work, or music that has been processed in the NFT already exists as a work. The goal here is to create a non-fungible (i.e. unique) token, generate a digital certificate from it, and monetize it. Although there some debate, NFTs are generally not works in themselves. Instead, NFTs are a tool for commercializing intellectual property rights. NFTs provide a fintech opportunity for intellectual property owners to explore and further commercialize their intellectual property.


An NFT is a digital content compiled with standard contracts, and as a result of this compilation, unique metadata can be written to the blockchain. Thus, an NFT represents the underlying work and indicates its’ location. An NFT is a digital receipt that links the original content to the blockchain with the help of a link.


Copyright is the legal right that a person has over any intellectual labor and products created as a result of their creations. Duplicating the work and transmitting it to the public without the permission of the author is a type of crime in article 71 of the Law on Intellectual and Artistic Works. NFT platforms allow their users to mint or create an NFT and sell them in the marketplace. Considering the steps of the minting process provided by these platforms, users will have the choice upload their (or others’) works (content such as digital art, video, or photography). Keep in mind that one of the necessary conditions for a work to be subject to copyright is that it is original and not stolen from another work.


Once the files are converted to an NFT, the digital content is made available to users' accounts and platforms' websites. In addition to metadata, chain information can also be accessed, including the underlying image or video of the NFT.


According to some authors, it is possible to make these images or videos available without the author's permission, which could be considered copyright infringement. In addition, it is undisputed that the right of attribution is violated if the work of a third party is represented as the work of the creator of NFT. An NTF's link to copyright is through the graphics rendered on this token. Although everyone can see the data processed on it, the ownership belongs to the owner of the work, purchasing the said token does not pass the copyright of the work on it to the person who bought it. The person who purchases the NFT will not be the owner of the copyright of the work that is automatically processed on the NFT with this sales contract, unless it is also agreed by the parties in the sales contract.


References:

  1. Pınar Çağlayan Aksoy and Zehra Özkan Üner, NFTs and copyright: challenges and opportunities

Authors:

Attn M. Murat Gülgün

Hazal Kızılkaya, Legal Trainee

bottom of page