First of all, congratulations on creating intellectual property worth licensing! Putting in place an Intellectual Property Licence Agreement is a great opportunity to monetise intellectual property that you have worked hard to create and for which you have invested significant time and money, such as through development or trademark and patent registration.
Parties to the Agreement
When drafting your Intellectual Property Licence Agreement you should set out the parties to the agreement, which are the licensor (who owns the intellectual property) and the licensee (who will use the intellectual property). You should make sure you include the relevant Australian Business Number (ABN) of either party if they are a company or sole trader. You should also include the full contact details of each party, including postal address and email so that either of you can provide notice of any issues or if you are the licensor, to ensure you can locate the licensee to seek payment.
The recitals section of an Intellectual Property Licence Agreement provides the background information to the agreement and sets out why the intellectual property is being licensed. It should set out that the licensor is the owner of the intellectual property rights in the intellectual property being licensed. You should also include that the licensee has requested the licensor’s permission to use the intellectual property for a purpose, which you have both agreed upon. You should include the full details of the intellectual property being licensed in the schedule to your Intellectual Property Licence Agreement, as well as the purpose or project for which it is being licensed.
You can also include in the recitals the information about how the intellectual property was developed or registered. For example, was it developed to enable the operation of the licensor’s business, or was a patent registered to protect a design, or was a trademark registered by the company to protect the brand?
Fees and Purpose
You should then include whether there are fees associated with the licence and, if so, you should state that the licensor agrees to grant the licence for the non-commercial or commercial use (whichever is applicable) of the intellectual property on the terms and conditions set out in the agreement.
Your Intellectual Property Licence Agreement will set out all of these terms and conditions and ensures that the licence is only used for the purpose that you define. You should also state in your schedule to the agreement, the intellectual property you will be licensing including the patent or trade mark registration details, the documents, templates or images and image details if you are licensing a photograph.
Having a schedule included in your Intellectual Property Licence Agreement also practically assists you, as you can update the details for each licence without having to redraft the entire agreement. You should include any additional fees associated with the Intellectual Property Licence Agreement, the territory in which the license can be used, the payment method, the invoice terms and the notice period required to terminate the agreement in your schedule.
At LegalVision we work with small businesses, inventors and creative people on a regular basis and can assist you by drafting and reviewing your Intellectual Property Licence Agreements. So if you’re in need of legal advice, contact us on 1300 544 755 and speak with one of our IP Lawyers.