What Is A Licensing Agreement?
As the holder of any intellectual property rights, you can use a license to make some income from the creative work or invention for using your product. A license protects the proprietary rights for intangible products such as software or virtual inventions. A licensing agreement refers to the terms and conditions written down that explain how any other party will use the original product in exchange for money.
Before creating a licensing agreement, you need to know the scope of your rights. Property rights have been categorized into patents that cover inventions, copyrights that cover original works in tangible form and trademarks that cover symbols, words, names or anything that identifies goods or services. Once you have handled your intellectual property rights, you can proceed with creating a licensing agreement.
The agreement needs to be straightforward and easily enforceable. It needs to cover the following sections.
• The Scope: once the license is issued it assigns limited use of the property allowing the owner to keep ultimate ownership rights. The scope can be broad enough allowing unlimited creativity but should also be non-exclusive, allowing you to sell it to other people. Note that, people shouldn’t pirate or reproduce the product with the license.
• The Revenue: a fee is paid at the point of purchasing the license but recurring agreements might be drafted especially for royalties or monthly lease payments. The same can also cover maintenance charges on the original products.
In the event that your product is pirated or used without a license, you can always follow legal processes to ask for an injunction or damages, depending on the severity of the case. Copyright infringement, one of the most common cases of license misuse can lead to penalties such as prison sentences or hefty fines. You can always seek a patent attorney before creating a licensing agreement for the best results.