A license agreement is an agreement that is made between two people. According to this document, two people can participate in this process:
- Licensor is the one who transfers the right to use the object.
- The licensee is the one who gets the right to use the intellectual property.
In most cases, signing a license agreement implies that the licensee wishes to distribute in some way the product that is the property of the licensor. To use the patented product without hindrance, the licensee must comply with a certain list of conditions that the licensor sets. Besides, it is important to make appropriate payments for the use of such products promptly.
The use of license agreements can be found in different areas. For example, a person engaged in business activities can negotiate with a professional sports team to develop a team logo, as well as to sell products with this logo. Also, a novice manufacturer will be able to use the already patented technology of a popular brand to be ahead of their competitors and not waste time developing their technology. As a result, numerous situations are noted, so it is correct to issue a license agreement, according to the laws of Ukraine.
Moreover, the design of the submitted document will be useful not only for the owner, but also for those who are going to use the object of intellectual property. After all, these documents will specify important legal aspects related to the use of the license.
The list of basic conditions for proper document design includes:
- Specific license type.
- All kinds of rights and acceptable ways to use the object.
- The territory where the agreement is considered valid.
- The amount of the fee and the timing of receiving payments during the use of the object, and more.
Before signing a license agreement, both parties must identify and consider the following important aspects:
- Specific type of license. Possible uses and the scope of rights granted to the licensee.
- A certain territory where the agreement will be considered valid. Thus, it is possible to limit the effect of this document and to establish territorial boundaries.
- The term of validity of the future agreement, during which it will be considered active, is set.
- Compliance with the established procedure for making payments, as well as their size. The most common type of payment used in license agreements is called royalty. Due to this type of payment, all cash payments are received as periodic payments for the duration of the document. The amount may depend on the set percentage of the profit that the licensee receives for using this object.
- Special provisions are taken into account and the terms of the contract are set, taking into account certain examples such as software products.
- Maintenance service. Often in the process of processing such documents, the transfer of an IT product occurs in the form in which it is presented. Thus, the licensor will not be responsible for the performance of the product and does not undertake to perform its maintenance in the event of a malfunction. Therefore, it is important to discuss this nuance in detail before signing the license agreement.
- Information data is protected and processed.
- Respect for the confidentiality of information that concerns both parties.