Intellectual Property Rights

In today’s highly competitive business environment, a person may be interested in starting a new business, expanding or extending an already existing business, or improving the business reputation in the market. In most cases, licensing of Intellectual Property Rights (IPR) can prove to be effective in achieving such business goals.

A licensing agreement refers to a partnership agreement between the owner of intellectual property rights, i.e., the licensor, and the person who is authorized to utilize such rights, i.e., the licensee, in exchange for an agreed-upon payment, i.e., royalty or fee. Licensing agreements are of the following types:

  1. Copyright Licensing Agreement
  2. Trademark Licensing and Franchising Agreement
  3. Technology Licensing Agreement

In general, some or all of these agreements form part of a single contract as the licensing agreements involve many rights and not just a single IPR. Being the owner or licensor of IP, a person can ensure a steady stream of additional income; and as a licensee, a person can sell, manufacture, import, distribute, or market the products and services related to the business, which he wouldn’t have been able to do otherwise.

In terms of the international context, a licensing agreement is possible only if the owner wishes to license an intellectual property right that is protected in the other country as well. Moreover, if the same IP Right is not a part of the other country’s laws and regulations, then the owner also has no legal rights to put any restriction over its use by anyone else.


If a brand or a business entity is interested in:

  1. Manufacturing, marketing, or distributing the original literary or artistic works of the creators, or
  2. Expanding or extending their already existing market for the literary and artistic works of their creators,

then they may consider Copyright License Agreements. Sometimes, owners find it arduous to manage their Intellectual Property Rights and have usually formed collective management organizations for representing and managing the rights on their behalf. Therefore, if a person wishes to acquire these rights, he or she may have to reach to the appropriate collective management organization that will be authorized to license the rights of their members.


If a brand or a business entity is interested in:

  1. Marketing or selling a product, or service whose trademark is owned by others, or
  2. Extending or expanding their already existing market for a product or service for which their business owns the rights conferred by a trademark,

they may consider a Trademark Licensing or Franchising Agreement.

A trademark helps in distinguishing the products or services of one enterprise from others by identifying their source of origin and making an implied reference to the quality and brand name. Therefore, in the case of a Trademark Licensing Agreement, the owner is highly advised to maintain a close connection with the licensee for ensuring that quality standards are maintained and the consumers aren’t deceived.

Through a Trademark Franchising Agreement, the owner of a business or brand entity who has already achieved some success corresponding to the trademark may collaborate with another enterprise (franchisee) who will bring in the expertise of their own or financial resources to provide the products or services directly to the consumers.


A technology licensing agreement consists of the agreed-upon terms and conditions using which the licensor authorizes the licensee to use the technology.

If a business entity is interested in improving the quality of a product or service or manufacturing a new product or service by using the rights owned by another enterprise in the form of a patent or utility model, then acquiring such rights through a technology licensing agreement can prove to be fruitful. Additionally, if a business wishes to extend its already existing market for a product or service for which they own the rights in the form of patent or utility model, then authorizing any other enterprise to use the product or service with the help of a technology licensing agreement can be the right solution.


Licensing the intellectual property to a third party can indeed prove to be very beneficial for the owners who don’t have sufficient financial and technical knowledge to explore the diverse applications of their inventions. However, the owners or licensors must be aware of the fact that not all licensing agreements lead to profitable and desired outcomes. Therefore, before signing any licensing agreement, the owners must ensure that the party with which they are working has the resources and commitment to take their IP to another level.