The Best IP Licensing Companies 2023

Owing intellectual property could sometimes be more valuable than physical property. Sharing your IP with others through IP licensing is what gives it value in exchange for fees.

What is the IP licensing business?

IP licenses have the advantage of allowing other individuals or businesses to use or utilize your IP rights which can include patents, trademarks, copyrights, and trade secrets in the exchange for a fee – producing a valuable source of passive income for IP owners. But you must keep in mind that using others’ intellectual property rights without their agreement could put you at risk of infringement of their rights.

copyrighted works, patents, trademarks, industrial design, and geographical indication are all different forms of Intellectual property, unlike creative commons licenses that do not license rights other than copyright and similar rights.

What is sub-licensing?

Grant of permission by Licensee to the third party but not a related company to use licensed patent rights or technology for applications for which licensee is not directly engaged in offering licensed products or services.

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Trademark Registration

Copyright Infringement Definition

IP licensing considerations:

Effecting transactions involving copyrights, patents, trademarks,  personal rights, trade secrets, and other assets and subject to IP protections are commonly granted through IP licensing. IP owners enjoy specific exclusive rights to use. However, there are some potential benefits to letting others exercise some of those rights, and by documenting an IP licensing agreement the IP owner will have the ownership and the right to manage and authorize the IP.

Based on the type of the IP and the context the IP licensing agreements vary, Common IP licensing contexts include:

  • Generating revenue through commercial exploitation of IP
  • Expanding a business
  • Geographically
  • New product lines
  • Settling infringement claims
  • Selling assets or business

 

Components of a license agreement:

Identifying which IP will be the subject of the license is necessary to ensure both partakers are on the same track and not surpassing their rights. The agreement must explain what the licensee can do with the license, and whether the license is exclusive or not. also, It should discuss if the licensor can use the license or surrender all rights to the licensee.

  • Scope of the Grant
  • Exclusivity
  • Territory
  • Term
  • Compensation
  • Termination
  • Conclusion

Patent License Agreement Checklist:

  • Introductory text
  • Bargain
  • Deliverables
  • Fees
  • Payment terms
  • Taxes
  • Records and audits
  • Registration and maintenance of the intellectual property
  • Diligence
  • Confidentiality
  • Patent markings
  • Use of name
  • Export Compliance
  • Insurance
  • Compliance with laws
  • Representation
  • Disclaimer of Warranties
  • Term
  • Termination by licensee
  • Termination by licensor
  • Infringement and Litigation
  • Indemnification
  • Limitations of liability
  • Definitions
  • General Provisions
  • Ending text

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Difference Between The Utility Model And Patent Protection

Benefits of Customs Recordal

Forms of IP licensing:

There are three main forms of IP licensing agreements each providing slightly different rights, advantages, and disadvantages. You can create your own custom form of licensing.

  • Exclusive IP Licenses:

Gives a third_party an exclusive right to use the IP. While the owner cannot use the IP or gives other third parties the right to use the intellectual property.

  • Non-exclusive IP Licenses:

Gives a third_party an exclusive right to use the IP without preventing the owner from using the IP or giving it to other third_parties.

  • Sole IP Licenses:

Gives both the IP owner and the  third_party an exclusive right to use the IP. While preventing the owner to grant any other third_parties the right to use the IP.

 

Pros and cons of Licensing Intellectual Property:

IP licensing can yield various benefits but it also comes with its risks as well.

Advantages of IP licensing:

  • You don’t need to worry about traffic or other barriers as intellectual property is easier to cross national borders than physical products do, you’re not shipping products overseas you are just allowing foreign entities to use your IP which makes IP licensing a better way to enter foreign markets.
  • Another big and important advantage of IP licensing is that it can help improve your marketing. For instance, local businesses have more chance to reach their market and better targeting than national ones, By licensing your intellectual property to smaller businesses and entities you will get the advantage of better targeting that they enjoy without carrying the burden of market research.
  • IP Licensing will make you able to make a profit and generate more income without Carrying a burden of production cost, but you need to invest larger to be able to generate income from your IP. However, allowing others to use it will allow you to collect royalties and will pass the burden to him at the same time.
  • Diffusing conflicts between businesses is One oft-overlooked benefit of  IP licensing, creating a licensing agreement with infringers instead of suing them outright will let both terms avoid the expenses of conflict and generate more profit.

read more : How to protect your product from being copied

The disadvantage of IP licensing:

  • You’ll have little control over the way the licensee conducts its processes which means that your IP may be exposed to infringements.
  • IP licensing has no guarantee of revenue as loyalties are based on profit so if IP licensing fails to generate any profit there will be no revenue.
  • Your licensee could become an unintended competitor, especially in this E-Commerce era. If your licensee doesn’t run business in an ethical manner it might hit your reputation too even if you are not technically responsible for his actions.

What is a typical licensing fee?

Licensing fees vary as it’s based on the IP that is being licensed. Also, the percentage of sales a licensor depends on the industry and negotiating skills. For instance, royalty rates for consumer products vary between 2-10% of the product’s sale value. Franchises may require royalty payments of anywhere from 1-50% of total volume. 

IP licensing Vs. Franchising :

The Federal Trade Commission defines a franchise as to be offered and sold under the trademark of the Franchiser, Franchiser demands the franchisee to make a minimum payment of $500 or more and maintains significant control on the franchisee’s operation methods.

Franchises require registration and afford territorial rights where the licensee can sell similar licenses and products in the same area, the franchiser can afford support and training, also, the logo and trademark of the franchiser can be used by the franchisee. Franchisers exercise control over franchisees while the licensor does not have control over the licensee.

Some advantage of franchising is that it allows an individual to be self-employed and brings a ready-made customer base with client listings that reduced the risk of failure, also, franchising allows expanding business for less investment than opening new locations.

While the advantage of ‘IP licensing is that allows the licensee to use, make and sell an idea, design, name, or logo for a fee so the licensor will expand their business without investing in new locations.

franchises are protected by securities law while licenses are protected by contract law, Some licensing agreements end up creating unintended franchises. Some examples of franchises are Mcdonald’s, Subway, 7-11, and Dunkin Donuts.

The best IP licensing companies

If you’re interested in licensing your IP it will be critical to hire a professional agency in IP that can help you negotiate a licensing agreement that works for you and create benefits.

Baianat is one of the leading companies in IP that assists its clients to defend their business through the diverse services, we supply. Take benefit of our comfortable & efficient processes by hiring our intellectual prosperity company.

Baianat is committed to advising customers in all forms, such as Intellectual Property submitted, licensing, and franchising, we aim to provide you with premium services and advice, drawing up and reviewing franchise and licensing agreements, and advising on regulations and disputes related to the same around the world.

Business Info:

6663 Ar Rayan – Al Nafel Dist. Unit No 44 Riyadh 13312 – 3556 Kingdom of Saudi Arabia.

O Box: 85424, Riyadh 11691

  • +966 11 41 27 755
  • +966 11 41 27 755
  • info@baianat-ip.com.sa

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