Pay for a website, own a website. That’s how most clients assume it works. US copyright law defaults disagree — and so do most agency contracts.
Intellectual property in web design is poorly understood by clients, inconsistently handled by agencies, and rarely explained during the sales process. The result is that a significant portion of businesses paying tens of thousands of dollars for a custom website don’t own what they think they own.
The Default is Not What You Think
Under US copyright law, the creator of original work owns the copyright — unless a specific exception applies. The most important exception for web projects is work made for hire, which transfers ownership to the commissioning party.
Work made for hire is not automatic. For work done by independent contractors — which includes most web agencies — there are two requirements for work-for-hire status to apply:
- The work must fall within one of nine specific categories defined by the Copyright Act.
- There must be a written agreement expressly stating the work is made for hire.
Custom website code fits the categories. But the written agreement is the part that requires action. If your contract doesn’t say “work made for hire” explicitly, the default copyright ownership stays with the agency or developer — even if you paid them in full.
This is not a technicality. It has real consequences.
What Agencies Can Do If They Own Your Code
If an agency retains copyright on your site’s code and you leave, they can:
- Prevent you from using the code on a different hosting platform
- Charge you to retrieve a copy of the code you can actually use
- Demand you rebuild the site from scratch when you switch agencies
- In extreme cases, send a DMCA notice to a new developer who modifies “their” code
Most agencies won’t do any of this. But the fact that they legally could — because the contract didn’t explicitly transfer ownership — gives them leverage in any dispute.
Kevin built a 40-page WordPress site with a boutique agency. The contract said he owned the “website” but didn’t mention code ownership or work-for-hire. When he tried to take the site to another developer after a falling out, the agency claimed the custom theme code was their intellectual property and sent a cease-and-desist to the new developer. Kevin spent $3,800 in legal fees and ultimately rebuilt the theme from scratch.
The Four Ownership Questions That Matter
Who owns the original code? The custom code written for your project — the theme, the custom plugin logic, the proprietary integrations. This should be assigned to you at completion. The contract should say “all original work product is work made for hire” or include explicit language assigning copyright upon final payment.
Who owns the design assets? Wireframes, mockups, brand elements created for the project — the layered design files, not just the exported images. These are separate from the code and should also be assigned. Many agencies provide the design output (the live site) but retain the source files (the Figma or Photoshop originals). Whether they have to give you those files depends on the contract.
What about third-party components? Your site almost certainly includes open-source libraries, licensed frameworks, premium plugins, and stock assets. The agency cannot assign ownership of things they don’t own. What they can do is ensure your licenses are in your name and provide documentation of all third-party components used. Ask for this as a project deliverable.
What happens to your content? Content you created (copy, images, videos) was yours going in and remains yours regardless of the contract. But content the agency created or commissioned — copywriting, photography, custom illustrations — follows the same work-for-hire rules as the code.
The License vs. Assignment Distinction
Some agency contracts are written around licenses rather than assignments. This sounds similar but is meaningfully different.
An assignment means the IP transfers to you. It’s yours.
A license means the agency retains ownership and grants you permission to use the work under specified conditions. Licenses can be exclusive or non-exclusive, revocable or irrevocable, unlimited or time-limited.
Clients often sign license agreements thinking they own the work. “You have the right to use this website” sounds like ownership. It’s not. Depending on the license terms, the agency could theoretically:
- Revoke the license if you breach any contract term
- Limit your right to modify the work
- Retain the right to use the work themselves (for templates, resale, etc.)
Assignment language is unambiguous. Look for: “All original work product created under this agreement is assigned to Client upon receipt of final payment.” If you see “license,” ask specifically whether an assignment structure is available instead.
Agency-Retained Rights to Watch For
Even when contracts include IP assignment, agencies sometimes carve back rights for themselves. Common ones:
Portfolio rights. The agency retains the right to display your site in their portfolio. Broadly, this is fine and expected. Narrowly, check whether the clause permits them to use your logo, your revenue numbers, or your customer testimonials in their case studies. You may not want specific business information used in their marketing.
Template and component reuse. If the agency uses proprietary internal frameworks, UI component libraries, or base themes — and those are included in your site — they may retain rights to those components. They’re assigning you the custom work layered on top, not the foundation underneath. Understand what’s custom-built vs. what’s an agency asset you’re licensed to use.
Training data rights. An emerging clause in some contracts: the right to use client projects as training data for AI tools. This is worth looking for in any contract signed in 2024 or later.
What Full Ownership Actually Looks Like
A project that delivers full ownership to the client includes:
- Explicit work-for-hire language or written copyright assignment
- Delivery of all source files (code repository, design source files, asset originals)
- All hosting, domain, and platform accounts in the client’s name with the client’s payment method on file
- All license keys and third-party credentials transferred or renamed to the client
- A written inventory of all third-party components and their license status
- No ongoing dependency on agency-held tools or platforms for the site to function
If any of those are missing, ownership is partial. The gaps are where the leverage lives.
This is why our custom WordPress development ends with a full handoff: code repository, credentials, license inventory. Nothing is held back, and there’s no continued technical dependency on Designodin for the site to function.
Negotiating IP Clauses Before You Sign
The time to negotiate IP terms is before signing — not mid-project, and certainly not at dispute time. Specifically:
- Replace license language with explicit assignment
- Add a clause requiring delivery of all source files as a project deliverable
- Specify that all accounts are in the client’s name from the start of the project (not transferred at the end)
- Add a clause clarifying that agency portfolio use does not include proprietary business information without separate written consent
- If the agency uses internal frameworks, get a written description of what is assigned vs. licensed
If you’re working with an agency that resists explicit assignment, ask why. “We retain the code because our framework is proprietary” is an answer you can work with. “That’s just how our contracts work” is not.
You can check what technology your site is already built on before any renegotiation by running an audit through Honest — it surfaces plugins, frameworks, and technical dependencies without requiring code access.
What to Do If You Already Have a Contract Without Clear IP Terms
You may already be in a relationship where the IP question was never settled. Options:
- Review what you signed. Look for “work made for hire,” “assignment,” “license,” and “IP” as search terms. Understand what’s there before the next conversation.
- Get a written clarification. Email the agency asking for confirmation that you own the code upon final payment. Their response is informative regardless of what it says.
- Negotiate it as part of any contract renewal or project extension. New work is a natural moment to restructure the ownership terms for the existing site as well.
- Have a lawyer review the contract. For projects over $10,000, this is worth the investment.
Our fixed-price packages include explicit ownership language from the first invoice. No negotiation required — it’s the default.
Frequently Asked Questions
If I own the domain, do I own the website? No. Domain ownership and website ownership are separate. You can own the domain and have it point to a site built on code that belongs to someone else.
What about open-source code — do I own that? Open-source code is owned by its respective communities and contributors under its license terms (MIT, GPL, etc.). You can use it, distribute it, and modify it per the license — but you don’t own the underlying framework. What you own is the original work layered on top.
Can I copyright my website’s design? Yes, original design elements created for your site — layouts, custom illustrations, unique visual compositions — are copyrightable. The same work-for-hire rules apply. If a designer created them under contract, make sure the assignment is explicit.
What if the agency goes out of business? Do I automatically get the IP? Not automatically. IP can be sold as part of business assets in bankruptcy or liquidation proceedings. Having clear assignment language in your contract, with source files in your possession, is the only reliable protection.
Does open-source WordPress mean I automatically own everything on a WordPress site? WordPress (GPL licensed) means the core platform is free to use and distribute. But custom themes and plugins built for your project are a separate matter — those are original work and require explicit assignment from whoever wrote them.