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What should I include in my licensing agreement?

On Behalf of | Oct 4, 2022 | Intellectual Property Licensing |

As you expand your business, there may come a time when you want to use property that is patented, copyrighted or has a trademark. If so, you will need to obtain a licensing agreement with the owner of the intellectual property so you can lawfully use it in your own enterprise.

What is included in a licensing agreement?

In your licensing agreement, the owner of the intellectual property will agree to let you use the property for a price. Generally, this may be a percentage of the sales or revenue you make from the use of the property.

A licensing agreement will usually include an end date, meaning that the agreement will only be effective for a certain length of time. A licensing agreement can also cover whether you will have the exclusive right to use the protected property. Many licensing agreements also give the owner of the property the ability to cancel the agreement under certain circumstances.

Why would you need a licensing agreement?

Intellectual property has value that the original owner of the property will want to hang on to. To protect this value, property may be protected by patent, copyright or trademark law.

Inventions and processes that provide a new product or way of doing something can be patented. Copyrights are given to protect works of authorship such as published works, performances, films or music. Finally, trademarks are given to protect works that identify a person’s goods or services, such as phrases and symbols.

Patents, copyrights and trademarks ensure that a person will remain in control over their own intellectual property and said property cannot be used by anyone else absent a licensing agreement stating otherwise. Licensing agreements are important both to the owner of the property and the party that wants to use it and should be carefully and thoughtfully executed to ensure both parties’ rights are protected.