The licence to earn money

You can license a patent, a trade mark, a registered design or copyright. Licensing agreements must be adapted to your specific needs depending on what is being licensed. For example, should the licensing rights be exclusive, i.e. do you only want to grant them to one licensee and exclude yourself? Also an option are straightforward licensing rights (where there are several licensees) and sole licensing rights (where there

is only one licensee). Take your time and do not simply adopt ready-made contract templates. There is nothing stipulated by law, but it is definitely advisable to conclude your contract in writing.

Describe exactly which IP right is being granted for use, to whom, to what extent (i.e. in which countries) and for what remuneration, as well as under what other terms and conditions (i.e. with or without an obligation of use). Clearly record the start, duration and termination of the contractual relationship. In return, the licensee has to pay a fee (e.g. a flat rate, a percentage of turnover or profit, or a combination of any of these).

As the licensor, you are liable for ensuring that the licensee is allowed to dispose of the rights and that they do not infringe any third party rights. Therefore, limit liability if necessary.

This is important at all times. Secrecy must be agreed on about anything confidential before, during and after termination of the contract. The right of use should remain under the control of the licensor. Signing a non-disclosure agreement (NDA) prior to the licensing negotiations reduces the risk of valuable information leaking out for both parties.

Obligate the licensee to defend the IP rights used. After all, they are profiting from your innovation, which is why they are also responsible for monitoring the market.

Now you know the most relevant points about licensing IP rights. Nevertheless, always draft your licensing agreements with the aid of IP professionals. You can find a list of specialists who can support you with this on our website.

Checklist in pdf