Licences and agreements: expansion of trademark rights

In order to bring your products and services to the attention of a wider audience, you could consider licensing your trademark. Put briefly, a licence is a permit to do or use something. A trademark licence is permission from the holder of a trademark allowing others to use it in a particular territory subject to certain conditions. In most cases, financial compensation (royalties) is naturally agreed.

The strength of trademark licences

Trademark licences play an increasingly important role in economic life. Licences are very useful for quickly bringing a retail chain or catering formula to the market by means of, for example, a franchise agreement (licensing agreement). Licences are also the basis for utilising the goodwill of a well-known brand or the popularity of an athlete, film star or cartoon character (portrait rights). In practice, such trademark rights are usually lodged with a holding company for tax reasons. The holding company has the option of granting licences to the various operating companies.

Examples of licences

Licenses have many forms, including:

• Licences to imitate the same product with the form (the design) being defined by a third party;
• Licences to produce and exploit a technological invention;
• Licences to use particular trademarks, products or services;
• Licences for cultivating a specific strain of plants.

It is also possible to licence copyright. Copyright is the exclusive right of the creator of a work – for example, a book, music, a scientific publication or a work of art – to publish and to reproduce this. The author can licence the publishing, copying, modifying, renting, lending or, more generally, the exploitation of a work.

Establishing an agreement

In order to develop a strong licence, it is important that the agreements between the licensee and licensor are put on paper. In principle, both are free to agree something with one another, which is then recorded. A licensing agreement should, however, include a number of key clauses, which are important because they are established and regulated by law. These include the registration of the participating parties, the subject, scope, area of application, type of licence and duration. A licensing agreement is something that you will in any case have to think hard about. We will be pleased to be of assistance.

Would you like to know more about licences?

The licensing of your trademark or portrait rights can produce additional revenues, also known as royalties. If you are considering licensing one of your trademarks to a third party, you can turn to Novagraaf for advice. We will be happy to assist you to organise the contractual details in the best possible manner. Also if you want to obtain a licence for a particular trademark, or have questions about trademark registration, trademark watching or trademark infringement, Novagraaf can give you the right advice. You can contact us by means of the contact form on the right top of the page.

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