What Does Licensing Agreement Means

In a typical licensing agreement, the licensee undertakes to make intellectual property rights such as technology, brand name or licensee know-how available to the licensee. In exchange for the intellectual property of the licensee, the purchaser usually plays the donor a pre-feeding and/or a licence fee. A licence fee is an ongoing fee paid for the licensee`s right to use intellectual property. The bargaining power of both parties to a licensing agreement often depends on the nature of the product. For example, a film studio that would grant the image of a popular superhero to an action figure maker could have considerable bargaining power in this negotiation, as the manufacturer will likely benefit from such an agreement. The film studio therefore has the lever to take its business elsewhere if the manufacturer has cold feet. The issue of compensation is particularly important. Based on the ownership discussed in the license agreement, different payment models may be useful. The use of songs is usually offset by royalties, for example. In other words, the owner of the copyright to a song is paid for each time the song is played on the radio, in a bar or even by another group at a live event. Other models may be a flat fee or even a rate per year/month/week.

A licensee may authorize a licensee to perform activities that are otherwise within the product, offer or import a patented product, or practice a patented process. [7] The validity of a patent license may be a “fixed” term (i.e. indicated), for example. B 5 years, or for the life of the patent (i.e. until the patent expires). A patent is, by nature, territorially limited; it extends only to activities within the borders of the country that issues the patent. A patent license therefore does not require a territorial definition. A licensee may authorize a licensee to market products under a brand name. With such a license, the licensee can use the trademark without fear of a right to trademark infringement by the licensee. Licensing often depends on certain contractual conditions. The most common terms are that a license applies only to a given geographic region, for a specified period or for a single stage of the value chain. In addition, there are different types of royalties under the trademark and brand license.

The first form requires a tax on invoice, the second type of royalty depends on the productivity of the taker. The software license agreement is displayed in the dialog box [Licensing Agreement]. Each licensing agreement is unique and these agreements vary by type (copyright, trademark, patent, etc.). In general, you will find these sections in most licensing agreements: start by setting up the property. If you are selling or buying a license for a product, make sure that ownership of that product is clearly stated in the agreement.

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