With the Patent License Agreement, the owner (licensor) grants another person (licensee) the right to use and/or exploit an invention for the payment of a fixed fee or a variable fee linked to sales (royalty).
The patent license allows the owner of an invention to exploit it economically, without ever transferring ownership. In this, the license differs from the sales contract, with which the owner definitively cedes the ownership of the patent.
The practical functions of the license can be the most varied, often the granting of this license can be very useful to access the market of specific territory or geographical area. It can also be an economic strategy for the owner who is not in a position to produce what has been patented in full or in the necessary quantities.
When using the patent license
The patent license can be used for any patented invention or for which a patent application has been filed. The patent can be applied for an invention, for a new industrial model (utility model, ornamental models and designs) or for new plant varieties.
However, there are also cases in which the owner will want to license a non-patented invention or technical knowledge and operational skills covered by non-patentable trade secrets (know-how). Also in these cases our license may be used, allowing the transfer to the licensee of the confidential knowledge developed by the owner.
Some typical license examples are:
- an inventor who licenses his patent for an innovative product to an industrial partner in order to produce and market it in exchange for a royalty on each unit sold
- a company that provides an innovative service that decides to license its working methods (non-patentable know-how) to a foreign partner capable of serving a new market.
The License to use the patent can be exclusive (e.g. when only the licensee will be able to commercially exploit the patented product) or non-exclusive (e.g. when several licensees can produce the patented invention). There is also the particular case in which the owner grants the license exclusively to a licensee but chooses to continue to use the patent in turn (the so-called relative exclusivity).
The patent license agreement should not be confused with the patent assignment agreement. In the case of the assignment of a patent, the owner transfers the ownership of the patent definitively. With the license, on the other hand, the use of an invention is granted against payment of a fee, without losing ownership of the intellectual property.
What the model patent license agreement contains
Our patent license meets all legal requirements. The main clauses included concerns:
- Subject: Description of the patent (or know-how) and its registration data.
- Exclusive: the choice to grant the patent in a given territory to one or more licensees.
- Duration: it can be unlimited with the possibility of revocation or granted for a predefined period of time.
- Obligations of the licensee: compliance with the quality standards imposed, prohibition to damage the prestige of the owner, etc.
- Obligations of the licensor: he undertakes to keep the patent and to renew it.
- Licensor checks and controls: the possibility for the owner to inspect the licensee’s operations and not to be held responsible for any damages deriving from the exploitation of the invention.
- Patent protection: the behaviors to be adopted in the event of counterfeiting.
- Validity: the owner guarantees that the patent does not violate the exclusive rights of third parties; identification of the behaviors to adopt in case of a dispute of the right.
- Termination of the license: the obligations linked to the termination of the use of the patent upon the dissolution of the contract.
- Fee: you can choose between fixed remuneration, royalty or both; with the possible provision of minimum royalties.
- Early termination of the contract: the holder may dissolve the license in the event of an event that does not allow the continuation of the relationship, provided that the violation is not remedied within 30 days.
Furthermore, after the purchase, we will guide you step by step through all the subsequent requirements necessary for your License to be duly constituted.
Information you need
To complete the document, all the details of the parties and the patent that must be licensed are required.
The document can be modified free of charge in all its parts without time limits. Don’t worry so if you don’t have all the information available during the interview, you can always enter it later.
Remember that our interview does not generate a simple facsimile of a patent license agreement. Based on your answers, the system automatically draws up a customized contract model for your exact needs, guaranteeing its legal correctness.
- Know-How License Agreement
- Non-Patentable Knowledge License Agreement
- Patent Exclusive and Non-Exclusive License Agreement
- License Agreement for Inventions
- User License Agreement: to use any intellectual property right
- Trademark License Agreement
- Software License Agreement
Other useful templates and facsimiles
- Patent Filing and Registration: to deposit and protect your invention for exclusive use at national, European or international level
- Joint Venture: to create a partnership aimed at a common project
- Trademark License Agreement: to use a trademark or to market, produce goods or services bearing the trademark
- Intellectual Property Transfer Agreement: to definitively transfer all the rights of an intellectual property
- Distribution Agreement: to instruct a person to purchase goods or services and then review them to third parties
- Franchising contract: to create a network of affiliated points of sale and spread your products