As a licensor (the party who owns the intellectual property) you should ensure when drafting your Intellectual Property Licence Agreement that you have set out in detail the obligations that the licensee (the party using the intellectual property) must subscribe to. This clause will vary significantly depending on the nature of the relationship and the level of engagement between the licensor and licensee.

What the Licensee should do

Nevertheless, it should always cover that:

  • the licensee agrees that there are no legal restrictions preventing them from agreeing to the agreement;
  • the licensee will cooperate and provide you with information and comply with your requirements in a timely manner;
  • any information they provide to you is true, correct and complete;
  • the licensee will not infringe any third party rights in working with you;
  • the licensee will inform you if they have any reasonable concerns relating to the licence of material under the Intellectual Property Licence Agreement with the aim that you both use reasonable efforts to resolve the concerns;
  • the licensee will inform you if they become aware that a third party may have infringed your intellectual property rights; and
  • the licensee will meet any other requirements that are important in your industry, such as holding particular qualifications or own other licences.

What the Licensee should not do

 

The licensee should also agree that they will not:

  • change, modify, adapt or create derivative works or improve the intellectual property, unless the agreement allows derivate works to be created with attribution;
  • sub-license the intellectual property, unless in accordance with your sub-licence clause;
  • infringe your Moral Rights in relation to the licensed intellectual property;
  • republish the licensed intellectual property in a way that could reasonably be considered to be obscene, inappropriate or that would bring the licensor or their intellectual property into disrepute; or
  • use the intellectual property for commercial use, unless this is otherwise provided for in the agreement.

Warranties and Third Parties

Usually this clause survives the termination of the Intellectual Property Licence Agreement to ensure that the licensee does not use the material or discredit you even if the licence has been terminated.

As a licensor, it is important that the licensee meets their obligations and makes a number of warranties in regards to their ability to enter into the Intellectual Property Licence Agreement. As a licensee, it is important that you understand your responsibilities and that you do not breach this clause. You should make sure that you are aware of third party rights to ensure that you do not infringe these rights including those overseas if you are using the licensed intellectual property online.

Conclusion

As a licensor, it is important to have an Intellectual Property Licence Agreement that addresses the licensee’s obligations, and warranties to prevent issues arising at a later stage. So if you’re in need of legal advice in regards to drafting an Intellectual Property Licence Agreement, contact LegalVision on 1300 544 755 and speak with one of our experienced IP Lawyer.

Edith Moss

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