What is the Trademark License Agreement?

Trademark License Agreement

With the Trademark License Agreement, the owner of a distinctive sign (licensor) allows another subject (licensee) to use his own trademark to distinguish products or services for a fixed or calculated fee on sales (royalty).

The owner always retains ownership of the trademark and the licensee can use it under the established conditions. This allows the owner to economically exploit the prestige of his distinctive sign or to extend his commercial offer to new territories or to new types of products or services. The licensee can instead start his business or increase it by exploiting the reputation of the brand licensed.

The trademark license is mainly used by those who want to exploit their brand to enter new markets through business partners or other entrepreneurs. For this reason, we often find the trademark license together with more complex commercial contracts, such as eg. franchising agreements, commercial distribution agreements, etc.

When using the trademark license agreement

You can create both a license agreement for a registered trademark and a license agreement for an unregistered trademark. The licensee may in fact have an interest in licensing a trademark for which an application for registration has been or will be submitted. Before concluding a trademark license, it is however advisable to do due diligence to verify the actual ownership, the existence of oppositions or disputes or pending findings, administrative regularity (for example seizures on the trademark), etc.

The license can be granted exclusively when only the licensee can use the trademark, or without exclusivity when the licensor can appoint other licensees and/or use the trademark on his own. Furthermore, the license of a trademark can cover all or only a part of the products or services for which it was registered. For example, a film production company may license its brands in the toy industry to several licensees. While a fashion company could grant the exclusive use of all its brands to a foreign licensee to penetrate a market in which it does not yet have the necessary organization and experience.

The trademark license agreement should not be confused with the trademark transfer agreement. In the case of the transfer of a trademark, the owner transfers the ownership of the distinctive sign to a buyer. The license, on the other hand, allows you to transfer the rights to exploit the trademark to a licensee without losing ownership of the intellectual property. For this reason, the license is often improperly defined as a “brand use” or “brand rental” agreement.

Trademark license agreement: discipline and quality of goods

The trademark license is governed by art. 23 paragraph 2 of the Industrial Property Code.

The article specifies that in the event that the license is not exclusive and multiple manufacturers can produce products or services with the same logo or trade name, the licensees must be specifically obliged to produce goods of equal quality. This makes it possible to avoid confusing the final consumer with apparently similar products but of different quality.

For example, if the owner and his licensee produce a detergent using the same brand in the same territory, they must ensure that they produce the same type and quality of the product in order to protect the final consumer from potential errors.

What the Trademark License Agreement Template Contains

Our trademark license agreement meets all legal requirements. The main clauses included concerns:

  • Purpose: the indication of which brand is licensed
  • Limits of use: what authorizes the license and for which products and/or services it can be used. The license can be total, i.e. granted for all types of products and/or services for which the trademark is registered, or only for certain products and/or services.
  • Territory: the license can be limited to a given territory
  • Exclusive: the possibility of granting the intellectual property exclusively to a single licensee.
  • Fee: the ability to grant a free brand license or the choice of a fixed fee and/or a royalty based on sales. It is also possible to agree on a minimum royalty, to be paid regardless of the volume of sales achieved
  • Duration: the license can have an unlimited duration with the possibility of revocation or a fixed duration can be established
  • Obligations of the licensee: the quality standards linked to the brand must be respected, the prestige of the owner must not be damaged, etc.
  • Licensor checks and controls: the possibility for the owner to inspect the licensee’s operations in the production of goods or services bearing the trademark
  • Brand protection: the behavior that the parties must adopt in the event of counterfeiting and the forms of collaboration between the parties
  • Termination of the License: you can choose how long after the termination of the contract the licensee is required to cease use of the trademark, eliminating the related products from the market
  • Early termination: the holder may terminate the license in the event of an event that does not allow the relationship to continue
  • Language: The contract can be created in English when it comes to an international trademark license with foreign partners

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 data of the parties and the identification and registration data of the trademark or logo 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 trademark license agreement. Based on your answers, the system automatically draws up a customized contract model for your exact needs, guaranteeing its legal correctness.

Other names

  • Trademark use license
  • Trademark Use Agreement
  • Brand rental agreement
  • The license of a Logo, brand, symbol, mark or distinctive sign
  • User License Agreement:  to use any intellectual property right
  • Patent License Agreement
  • Know-How License Agreement
  • Software License Agreement

Other useful templates and facsimiles

  • Trademark Registration: To register a national, European, or international trademark
  • Distribution Agreement:: to entrust a subject to purchase goods or services and then resell them to third parties in a specific territory
  • Priority search: to verify that there are no identical and/or similar trademarks to the one you want to register
  • Intellectual Property Transfer Agreement: to definitively transfer all the rights of an intellectual property
  • Joint Venture: to create a partnership aimed at a common project
  • Franchising contract: to create a network of affiliated points of sale and spread your products