Licensing Intellectual Property

Licensing IP

IP Health Check 1

Intellectual Property Ofﬁce is an operating name of the Patent Ofﬁce

IP Health Check

booklets

This booklet forms part of our IP Health Check

series, a suite of booklets and online tools for

business which have been developed to help you

identify your intellectual assets and advise you

how best to exploit and protect them.

There are ﬁve IP Health Check

booklets in this series:

1. Licensing intellectual property;

2. Agreeing a price for intellectual

property rights;

3. Non-disclosure agreements;

4. Choosing the right IP adviser;

5. Resolving IP disputes.

Online IP

Health Check

The online IP Health Check is free for any business

to use and takes you through a simple questionnaire

which creates a tailored conﬁdential report setting out

an action plan.

There are seven online

IP Health Checks:

1. Trade Marks for branding of goods and services;

2. Patents for technology in products and processes;

3. Registered designs for the way products look;

4. Copyright for literature or artistic work;

5. Licensing your intellectual property for exploiting

your IP;

6. Conﬁdential information to keep your IP secure;

7. Protecting trade marks overseas.

The online IP Health Check is available at:

www.ipo.gov.uk/iphealthcheck.

About this booklet

This booklet is designed to give you an understanding

of the potential beneﬁts licensing intellectual property

offers your business. It:

• contains an introduction to the concept of

licensing intellectual property;

• gives an explanation of why businesses grant and

take licences of intellectual property;

• sets out a checklist of the most common issues

which you should consider before entering into

any licence agreement;

• provides a list of other resources for those who

want to learn more about licensing; and

• provides a list of useful contacts.

Licensing intellectual property is important to all sorts

of businesses – not just those in the technology

sectors. Companies can derive signiﬁcant income

from licensing, and licensing can offer ﬂexibility in the

way a business develops.

The main intellectual property rights (IPR) include:

Know-how (trade secrets) may also be an important

element of an intellectual property portfolio

and can be protected by conﬁdentiality (non-

disclosure) agreements and the law of breach-of-

conﬁdence. These are explained in more detail in our

accompanying booklet ‘My IP: Intellectual Property

explained’.

The management and licensing of the different

forms of intellectual property can be important to

the success of the business that invents or creates

a product, to manufacturers, to the designers that

conﬁgure or reﬁne a product’s appearance and to the

producers of packaging and marketing literature and

materials.

This is not a do-it-yourself guide to the law of

intellectual property and licensing. Lawyers skilled in

intellectual property and licensing should usually deal

with the more complicated legal aspects of licensing,

but (as with any specialist area) you will generally do

better, and save time and money, if you understand

the most important principles.

This booklet deals with commercial intellectual

property licences. If you want to license on a non-

commercial basis, you may be interested in a creative

commons approach.

We hope the information in this booklet will help you

explore and discuss licensing with other businesses

and with your professional advisers so that you can

effectively conduct intellectual property licensing

negotiations when it is in your interests to do so.

Inside

Licensing – the basics 1

What is an IP licence? 1

Why might I license my IP or take a licence of IP? 2

Preparing for negotiations 4

Elements of licensing agreements 5

Licence terms 5

What IP are you licensing? 7

Who may use the IP? 7

How IP may be used 8

Duration and termination 10

Governing law and disputes 10

Patent-speciﬁc licence points 11

Charges and payments 12

What risks are you taking and how might you

reduce those risks? 13

Useful resources 14

Checklist 17

Useful contacts 25

History and acknowledgements 28

To contact the

Intellectual Property

Ofﬁce

Tel:

0300 300 2000

Fax:

01633 817 777

Concept House

Cardiff Road

Newport

NP10 8QQ

For copies in alternative

formats please contact

our Information Centre.

A common example

of an IP licence is

the one you receive

whenever you buy a

copy of software to

use in your business.

Licensing – the basics

What is an IP licence?

A licence is a permission to do something that, without

the licence, would be an infringement of IP. The person

granting the licence is usually called the licensor, and

the person receiving the licence is usually called the

licensee. (There may be more than one licensor or

more than one licensee in a licence agreement).

A common example of an IP licence is the one you

receive whenever you buy a copy of software to use in

your business.

The terms and conditions on which IP is licensed

are very varied. The licensor and licensee usually

agree those terms and conditions by negotiation. The

outcome of those negotiations will depend on the

relative bargaining power of each side.

You are more likely to obtain favourable terms if you

own IP which protects a signiﬁcant and distinctive

innovation or work than if the potential licensee has

several equally attractive alternatives.

IP may be “licensed-out” or “licensed-in”. For

example, you may “license-out” to another company

or organisation in return for a reward, ﬁnancial or

other “in-kind” beneﬁts or a combination of both. You

may wish to “license-in” if you want to use another

company’s IP to develop your own business and

products.

You may sometimes have to accept that your IP is not

as attractive to a potential licensee as you would like.

IP Health Check: Licensing IP

Why might I license my IP or take

a licence of IP?

Some examples are:

Sharing Risk: Where a licensor licenses the right to

manufacture and sell products, the licensor receives

revenues from that licensing but does not take the

risk of manufacturing, promoting and selling those

products. On the other hand, the licensee has the

right to use the IP without the expense and risk

of the research and the costs of developing the

product.

Revenue Generation: An owner of IP may

commercialise the IP itself and may obtain additional

income by licensing the IP to someone else to

commercialise it in a different ﬁeld.

Increasing Market Penetration: An owner of IP

may license another business to sell in territories that

the owner cannot cover.

Reducing Costs: A business may ‘buy-in’

innovation to reduce its research and development

costs.

Saving Time: A business may get its products

or services to market more quickly by acquiring a

licence to use existing IP, instead of re-inventing the

wheel (sometimes referred to as an “engineering

workaround”).

A business may get its

products or services

to market more quickly

by acquiring a licence

to use existing IP.

IP Health Check: Licensing IP

Accessing Expertise: By taking a licence, a

business may tap into expertise that it does not

have in-house.

Obtaining Competitive Advantage: By acquiring

a licence to use IP, a business may obtain an

advantage over its competitors.

Collaboration: Businesses may want to work

together to develop new products and services.

Whenever you think about taking or granting a

licence of any IP the ﬁrst step should be to assess

the needs and objectives of your business and how

licensing might help meet them.

Taking a licence to use someone else’s IP will

be necessary if you want to use that IP without

infringing their rights.

Often granting or taking a licence will bring

advantages (money or new IP) to your business, or it

may even be the corner stone of your business – for

instance, where you supply services or sell products

that are based on someone else’s IP.

But granting or taking a licence is not always

appropriate. For instance:

• A business, which has the ability to

commercialise its own IP, may better achieve its

objectives by keeping that IP to itself.

• Businesses should be wary of licensing their IP

in circumstances where the value of that IP may

be diminished.

• The prospective licensor may want to charge

royalties that are too high and may restrict the

growth of the business.

Often granting or taking

a licence will bring

advantages (money

or new IP) to your

business, or it may even

be the corner stone of

your business.

IP Health Check: Licensing IP

• The IP to be licensed may be too weak – if a

competitor could work round it and take away

market share, it may not be worth investing in a

licence.

• The IP to be licensed may not be valid, for

example where a patent is open to challenge or

because the prospective licensor does not own

and does not have the right to license the IP.

Preparing for negotiations

This booklet and the checklist on pages 14-19

indicate the most common issues that you will have

to address when licensing.

Before you approach the other side, make sure you

understand the market for the IP and the potential

beneﬁts licensing could bring to your business and,

ideally, to the other party or parties.

If you are the licensor, you also need to think about

the return for granting the licence. Are you looking

for a purely monetary return (a lump sum and/

or royalties), or are you looking for some other

commercial beneﬁt (or both)? Also, think about

whether you will need to support the licensee and

whether, and what, you will charge for that.

The valuation of IP is not a simple exercise and you

may need to enlist the help of someone experienced

in this area.

Both or all parties should investigate whether the

licensor has the legal right to license the IP. This

involves the licensee carrying out ‘due diligence’.

Where the IP is capable of being registered, the

licensee should search the relevant registers.

The Intellectual Property Ofﬁce’s website

(www.ipo.gov.uk) has more information about this.

The valuation of IP is

not a simple exercise

and you may need

to enlist the help of

someone experienced

in this area.

IP Healthcheck: Licensing IP

Unless you have a realistic idea of the scope of the

licence and the worth of the IP before you start

to negotiate, the negotiations are likely to be time

consuming, and may ﬂounder.

The licensor should think about asking the licensee

to enter into a non-disclosure/conﬁdentiality

agreement before disclosing information. This is

especially important where the IP is a patentable

invention. In that case, early disclosure may prevent

the invention being patented. A non-disclosure

agreement will also be important where the

only means of protecting the IP is by keeping it

conﬁdential (as with trade secrets).

Finally, if you do not like negotiating or you are not

a skilled negotiator, ﬁnd someone who is good at it

to help you or to negotiate for you. Negotiating a

licence requires a strategy and takes skill. Licensing

negotiations can be stressful and yet can also be

very satisfying.

Elements of Licensing

Agreements

Licence terms

As far as the licensing process is concerned, some

licences are included as part of the agreement for

purchase of a product or service, and other licences

are agreed independently of any purchase.

It is not uncommon for the parties involved to

sign a non-disclosure/conﬁdentiality agreement

(though this is not always required), then negotiate a

mutually agreeable set of terms or ‘Heads of Terms’,

then draft and agree the licence agreement before

If you do not like

negotiating or you are

not a skilled negotiator,

ﬁnd someone who is

good at it.

IP Healthcheck: Licensing IP

ﬁnally signing the licence agreement. Normally the

licensor manages this process.

The terms of any licence should always be recorded

in writing and, until the licence agreement has been

signed, all correspondence and negotiations about

the terms of the licence should be expressed to be

‘subject to contract’, i.e. not binding. Recording

the terms in writing involves being completely

clear about what both licensor and licensee want

to achieve and have agreed. The act of reducing

an oral agreement to writing will often reveal

misunderstandings which need to be resolved

before the licence agreement is signed.

The checklist on pages 17–24 outlines the most

common issues on which you need to agree,

before you enter into your licence. You will save

time and money if you use this to help you deﬁne

(in plain English) what your business needs are from

the licence before you attempt to draft a licence

agreement, or involve a professional adviser. The

checklist cannot cover every conceivable issue and

your particular circumstances may well involve other

considerations. You should seek professional advice

if you are unsure.

Remember, the checklist is not a substitute for a

proper licence agreement and its contents are not

binding on either the licensor or the licensee.

Recording the terms in

writing involves being

completely clear about

what both licensor

and licensee want

to achieve and have

agreed.

IP Health Check: Licensing IP

What IP are you licensing?

This could be a patent or material which is protected

by copyright or a trade mark, or you may, for instance,

be allowing the public or subscribers to download a

wide range of materials of their choosing from your

website.

You may be licensing more than one sort of IP; for

instance some software and your logo or trade mark.

If that is the case, you may want different rights and

restrictions to apply to the different sorts of IP.

You may have licensed IP from someone else and, in

turn, want to license that IP (as well as your own IP)

to another business, for example as part of a package

of inter-related technology. In this case you will need

to check whether the licence ‘in’ allows you to license

it ‘out’.

You may also be allowing the licensee to use know-

how which you wish to be kept secret.

Who may use the IP?

The licensee may be a company, a group of

companies, another type of corporate body, an

individual or a collection of individuals, such as an

English partnership.

A common mistake, especially where licences are

formed online, is to confuse the individual who is

sitting at the PC and downloads the material with

his or her organisation. If you are entering into a

business-to-business (B2B) licence and the licensee is

not a sole trader, the odds are that you intend to allow

A common mistake,

especially where

licences are formed

online, is to confuse

the individual who

is sitting at the PC

and downloads the

material with his or her

organisation.

IP Health Check: Licensing IP

the organisation to use the IP, and not an individual

employee of the organisation, and the licence needs

to be to the organisation, not the individual.

However, some licences can cover entire enterprises

and bind not only the company but also the users of

its products.

If you are granting a licence to a company make

sure you quote its registered number in the licence

agreement. Companies change their names and

addresses but their number never changes.

How IP may be used

You are advised to start from the basis that licensees

are not allowed to do very much with the IP unless

they have a licence to do it. Be speciﬁc about what

the licensee may do with the IP. There are three main

types of licence:

• Exclusive – only the person who is granted

a licence, the licensee, can use the IP. The

licensor is not entitled to use the IP.

• Sole – only the IP owner and licensee can use

the IP.

• Non-exclusive – the IP owner may use and

license to more than one licensee.

Below are some of the things to consider about

the terms of a licence. Not all are appropriate in all

circumstances or for all sorts of IP.

If you are granting a

licence to a company

make sure you quote

its registered number in

the licence agreement.

IP Health Check: Licensing IP

• Can the licensee grant permission to others to

use the IP (sub-licences)?

• Are there any terms that must be carried through

to any sub-licence?

• Is the licensee restricted to using the IP for

particular uses: personal/private use, for

academic teaching/research, or for non-proﬁt

making purposes?

• Is the licence restricted to one or more speciﬁed

ﬁelds of use or distribution channel?

• Is the licence restricted to one or more territories

(countries)?

• May the licence be transferred (assigned) to

someone else?

• May the licensee have others manufacture and

sell products?

• Can the licensee import products protected by

the licensed IP?

• Can the licensee incorporate the IP (in whole or

in part) into another work or combine it with

other IP?

• Can the licensee make improvements to an

invention? In this case you will need to think

about who will own the IP in those improvements.

• Is the licensor entitled to “license back” any

translation or improvements etc.?

• Can a product be used only on/with another

speciﬁc item; ie a platform or device?

Can the licensee make

improvements to an

invention? In this

case you will need to

think about who will

own the IP in those

improvements.

IP Health Check: Licensing IP

The more speciﬁc you can be the better. Once you

have been speciﬁc about the permitted uses of the

IP, the licensor can reserve all other rights to itself.

Duration and termination

You should consider how long you want a licence to

last, and how it may be terminated.

• What the circumstances for termination might

be, for instance a change of control or a failure

to meet sales targets; breach of conditions or

insolvency?

• Is the licence indeﬁnite or limited by time?

You will need to check the duration of the IP.

For example, a European patent lasts for a

maximum of twenty years whereas a trade mark

can last for perpetuity so long as it is periodically

renewed.

• What rights will you lose; will you still be able to

conduct ongoing business?

• Will any rights or obligations remain after

termination, for example conﬁdentiality?

Governing law and disputes

• If entering into a licence with a party in a different

legal jurisdiction you will need to determine

which country’s laws should apply.

• Do you have a mechanism for resolving

disputes?

Is the licence indeﬁnite

or limited by time? You

will need to check the

duration of the IP.

IP Health Check: Licensing IP

When licensing abroad it is advisable to also

consider the cultural as well as legal characteristics

of your partners.

Can the licensee:

• make copies of copyright works?

• distribute copyright works?

• publish copyright material? If so in what form or

on what media that publication may take place?

• translate, modify or adapt copyright works (and

who will own the IP in the translation etc.)?

• determine the number of individual users

of copyright materials (how many users are

concurrent or named)?

Patent-speciﬁc licence points

Can the licensee:

• Use any process to make a product protected

by the patent?

• Manufacture and sell products protected by the

patent?

• Make a kit or composite using elements

protected by the patent?

Think carefully about

what you want the

licensee to do with

your IP.

IP Health Check: Licensing IP

Charges and payments

You need to consider how the licence is going to earn

a return for you or, alternatively, what and how you

will have to pay. As part of this process you should

think about what criteria you will use to value the IP

speciﬁed in a licence. It will help your negotiations

if you have a reasoned idea of the value of the IP

before discussing payments with a potential licensing

partner. Issues which need to be considered are:

• Are you going to charge or pay a lump sum

or one off fee and/or whether you are going

to charge or pay a fee based on use or items

manufactured or sold (sometimes called a royalty

on sales) or a combination of these two?

• Are you are going to charge or pay a pre-

determined periodic fee (e.g. a monthly, quarterly

or annual fee or a series of fees for certain

events)?

• Will there be any increases in any periodic or

usage fees?

• Will fees be indexed linked and whether minimum

fees should be set?

• Will there be any sales or other targets and the

consequences of the licensee not meeting those

targets?

• Will there be a charge or payment for giving up

the licence early or not commercialising?

Will there be any

increases in any periodic

or usage fees?

IP Health Check: Licensing IP

• How will returned sales and failures be treated?

• Are you going to charge or be charged if the IP is

incorporated with other IP or distributed as part

of another work?

• What happens at the end of the licence period,

when the lP is no longer used or on licence

termination?

• When and how will you pay or be paid and what

checks you may make to see that you have

received the right amount?

How you charge and pay will often depend on what

the market is used to/will bear.

What risks are you taking and

how might you reduce those

risks?

Most licences contain clauses limiting or excluding

the licensor’s liability, but you need to be aware

that they may not always work. The law imposes

complex rules about the effectiveness of limitation

and exclusion clauses and they should be drafted by

an expert.

If you are the licensee you will be looking for

warranties from the licensor, perhaps to the effect

that it has the right to license, that the IP is valid,

and that the licensor will defend any claims that third

party IP has been infringed. You may also want the

licensor to bear the ﬁnancial consequences of that

sort of claim (an indemnity). If you are the licensor

you will want to resist giving those sorts of warranty

and indemnity.

Most licences contain

clauses limiting or

excluding the licensor’s

liability, but you need to

be aware that they may

not always work.

IP Health Check: Licensing IP

As a licensor you will want to be sure about the

integrity of the organisation you are licensing to. You

will want to ensure that they have the necessary

systems in place so that your IP is used properly

under the terms of the licence. You should consider

the indirect effects of doing business with another

company. For example, if you are licensing a trade

mark you will want to consider whether the quality of

your brand will be affected by the goods it is applied

to.

It is a good idea to imagine and list all the things you

think could go wrong for your business, as if the

licence were in place, assess what impact they might

have and decide how those risks might be mitigated.

For example, if you are granting an exclusive licence

in return for a premium in the short term, think about

whether this is the best strategy in the long term.

Competition law may affect the terms of IP licences

and breach of competition law can lead to heavy ﬁnes

and penalties. A professional advisor will be able to

help you with this.

You might contact your insurance broker to

investigate the possibility of insurance to help fund

your legal fees if someone infringes your IP rights or

brings a claim against you for infringement of their IP

rights.

Useful Resources

A booklet of this length can only scratch the surface

of what is an important and complex subject. Listed

below are links to selected resources which discuss

IP and licensing in more detail.

It is a good idea to

imagine and list all

the things you think

could go wrong for

your business, as if the

licence were in place.

IP Health Check: Licensing IP

The potential for licensing the different components of

IP across the breadth of industry is vast. Because of

this, we have deliberately chosen not to provide links

referring to every conceivable category of licence.

What is intellectual property?

The Intellectual Property Ofﬁce provides comprehensive

information about intellectual property and how it can

be protected.

www.ipo.gov.uk

Online IP health checks is available at www.ipo.gov.uk/

iphealthcheck

Skeleton licence is available at www.ipo.gov.uk/

skeletonlicence.pdf

We do not accept responsibility for the contents of any

of the following resources.

Licensing of intellectual property

A comprehensive treatise on licensing from a US

perspective (1000 pages). Use with care; the law in the

US and the terminology used in the US is very different.

It may be found in the business category of the

Research and Markets website:

www.researchandmarkets.com.

Technology licensing

A pamphlet provided by Partnership’s UK, outlining the

main aspects of technology licensing (22 pages). This is

aimed at the public sector and concentrates on patent

licensing, but much of what it says is of more general

application. It may be found in the “Guidance section”

of the PUK website: www.partnershipsuk.org.uk.

The Intellectual

Property

Ofﬁce provides

comprehensive

information about

intellectual property

and how it can be

protected.

IP Health Check: Licensing IP

World Intellectual Property Ofﬁce

licensing resources

The following can be found at the World Intellectual

Property Ofﬁce’s electronic bookshop http://www.

wipo.int/ebookshop:

• Successful Technology Licensing (52 pages)

• Exchanging Value - Negotiating Technology

Licensing Agreements: A Training Manual (178

pages)

• Copyright licensing (168 pages)

IP Health Check: Licensing IP

Checklist

This checklist sets out the major issues you need to

think about before licensing IP. It can be used, for

example, to organise your thoughts before talking

to your legal advisor, to develop a negotiating

strategy for your personal use or as the basis

for a preliminary non-binding memorandum of

understanding or “heads of terms” before executing

a binding agreement. You are also advised to review

your intellectual property portfolio and obligations

in relation to intellectual property when considering

licensing.

N.B. This document is a checklist of the principles

to be agreed before an IP licence is drafted. It is

not binding on either the licensor or the licensee. It

is intended only to assist the parties to identify any

major issues early in their negotiations.



IP Health Check: Licensing IP

Subject Possible approach (for discussion) Answers/notes/

comments

Parties

Name, company number (if applicable) and registered ofﬁce/principal

place of business of the licensor.

Name, company number (if applicable) and registered ofﬁce/principal

place of business of the licensee.

Will other members of the licensee’s group of companies be able to

use the IP?

If ‘yes’, will the licensor grant the right to use directly to other members of

the licensee’s group, or will the licensee grant sub-licences to its group?

What is being

licensed

What is the main IP being licensed?

Is the IP capable of registration and should that be put in place before

proceeding?

Is there any other IP that the licensee will need to be able to use to beneﬁt

from the licence?

What know-how or other conﬁdential material is the licensee being

permitted to use?

Does any of the IP belong to someone other than the licensor? If it does,

does the licensor have the right to license it?

Are there any terms and conditions that apply to any of the IP which has

been licensed in that must be carried through to the licence?

If the IP is jointly owned by the licensor and another person, does the

licensor have the right to license the IP?

IP Health Check: Licensing IP

Subject Possible approach (for discussion) Answers/notes/

comments

Rights

granted/

Restrictions

imposed

These

issues should

be addressed

in relation to

each piece

of IP being

licensed)

Will the licence be:

• exclusive (licensor may not use the IP);

• non-exclusive (licensor may use the IP and grant other licences); or

• sole (licensor may use the IP but will not grant other licences)?

May the licensee grant sub-licences to others?

Will the licensee be restricted to using the IP for:

• personal/private use;

• academic teaching/research;

• non-proﬁt making purposes; or

• other limited purposes?

• Will the right to use the IP be restricted to:

• one or more particular ﬁelds of use;

• one or more distribution channels;

• one or more speciﬁc territories?

May the licensee transfer (assign) the licence freely or only with the

licensor’s permission?

May the licensee use the IP to provide services to others?

May the licensee manufacture and sell products?

May the licensee import products?

IP Health Check: Licensing IP

Subject Possible approach (for discussion) Answers/notes/

comments

Rights

granted/

Restrictions

imposed

(These issues

should be

addressed

in relation to

each piece

of IP being

licensed)

May the licensee use the IP to carry out a process?

What rights and restrictions will apply in respect of:

• copying works;

• modifying/adapting/translating works;

• making improvements;

• incorporating into another work/with other IP;

• publication and distribution;

• sharing with others;

• using only on/with a speciﬁc platform or device?

How will improvements be identiﬁed?

Who will own the IP in any improvements/developments/

modiﬁcations/translations?

Will there be any license back of improvements/

developments/modiﬁcations/translations?

Will competition law affect the terms of a licence?

IP Health Check: Licensing IP

Subject Possible approach (for discussion) Answers/notes/

comments

Fees and

Payment

How will the licensor and licensee each realise beneﬁt from the licence?

Is the licence part of a larger transaction involving other sources of

commercial beneﬁt or trading of IP? If yes, what is the nature of

that transaction?

Will there be one or more lump sum payments?

If yes, how much will be paid and when?

Will there be ongoing payments or royalties?

If yes, how are they to be calculated, e.g.:

• by reference to use or items manufactured or sold; or

• a pre-determined periodic payment?

Under what circumstances (if any) and by how much may these payments

or royalties be increased? Will they be indexed-linked?

When will these ongoing payments and royalties start?

How frequently will they be calculated and paid?

Are there any minimum payments? If yes, what are they?

Will the licensee have to meet any sales or other targets?

IP Health Check: Licensing IP

Subject Possible approach (for discussion) Answers/notes/

comments

Fees and

Payment

How will any targets be reviewed during the licence period?

What will be the consequences of not meeting any targets (e.g. loss of

exclusivity or termination of the licence)?

Will the licensor have the right to audit the licensee’s books?

At what rate will interest be paid on late payments?

IP Protection

and

Infringement

Will the licensor or the licensee be responsible for registering any IP, or

renewing any existing registration?

Who will bear the costs of the above?

Will the licensor or the licensee be responsible for pursuing any infringers?

Who will bear the costs of the above?

Will the licensor give the licensee any indemnity against the infringement of

third party IP?

Will the Licensee give the licensor any indemnity against third party claims

resulting from the licensee’s act or omission?

IP Health Check: Licensing IP

Subject Possible approach (for discussion) Answers/notes/

comments

Conﬁdentiality What information of the licensor is to be kept conﬁdential?

What information of the licensee is to be kept conﬁdential?

Is conﬁdential information to be kept conﬁdential indeﬁnitely or for a

deﬁnite period?

If the latter, what period?

Is either party subject to the Freedom of Information Act?

Warranties

and Liability

Will the licensor give any warranty:

• as to its ownership of the IP/ its right to license;

• that the licensed IP will not infringe third party rights;

• that the licensed IP/material will comply with speciﬁcation;

• in relation to anything else?

Will there be any ﬁnancial cap of the liability of the licensor?

Is liability for loss of proﬁts, business, contracts etc. to be excluded?

Is that exclusion to apply where an indemnity has been given?

IP Health Check: Licensing IP

Subject Possible approach (for discussion) Answers/notes/

comments

Other Issues Is the licence:

• of indeﬁnite duration (for the life of the IP);

• for a ﬁxed period (and if it is what is that period)

• terminable by either party giving notice to the other (and if so under

what circumstances)? It is assumed that the licence will be terminable

for breach of contract or insolvency of a party.

May the licensor terminate if there is a change in the ownership of the

licensor?

What will happen on the termination/ expiry of the licence?

Are any provisions of the licence agreement to continue after termination/

expiry and for what period?

Who will be the contact point for each party and how can they be

contacted?

What support and training will the licensor provide to the licensee?

IP Health Check: Licensing IP

Subject Possible approach (for discussion) Answers/notes/

comments

Other Issues Is the licence:

• of indeﬁnite duration (for the life of the IP);

• for a ﬁxed period (and if it is what is that period)

• terminable by either party giving notice to the other (and if so under

what circumstances)? It is assumed that the licence will be terminable

for breach of contract or insolvency of a party.

May the licensor terminate if there is a change in the ownership of the

licensor?

What will happen on the termination/ expiry of the licence?

Are any provisions of the licence agreement to continue after termination/

expiry and for what period?

Who will be the contact point for each party and how can they be

contacted?

What support and training will the licensor provide to the licensee?

Useful Contacts

The following list contains some contact details you may

ﬁnd useful. It is not a full list but it does provide a good

starting point.

The British Chambers of Commerce

Website: www.chamberonline.co.uk

Phone: 0207 654 5800

Flexible Support for Business (Wales)

Website: www.fs4b.wales.gov.uk

Phone: 03000 603 000

Business Gateway (Scotland)

Website: www.business.scotland.gv.uk

Phone: 0845 609 6611

The British Library Business & IP Centre

Website: www.bl.uk/bipc

Phone: 02074 127 454

Business Link (England)

Website: www.businesslink.gov.uk

Phone: 0845 600 9006

CBI

Website: www.cbi.org.uk

Phone: 02073 797 400

The Chartered Institute of Patent Attorneys

Website: www.cipa.org.uk

Phone: 02074 059 450

Companies House

Website: www.companieshouse.gov.uk

Phone: 03031 234 500

Creative Commons

Website: http://creativecommons.org

IP Health Check: Licensing IP

The European Patent Ofﬁce

Website: www.epo.org

Phone: +0049 89 2399 4636

Phone: +0049 89 2399 0

Innovators Counselling and Advisory Services

for Scotland (ICASS)

Website: www.icass.co.uk

Phone: 01415 728 395

Institute of International Licensing Practitioners

Website: www.iilp.net

Phone: 01296 728 136

The Institute of Trade Mark Attorneys

Website: www.itma.org.uk

Phone: 0207 101 6090

Intellectual Asset Centre (Scotland)

Website: www.ia-centre.org.uk

Phone: 0141 243 4920

Institute of Patentees and Inventors

Website: www.invent.org.uk

Phone: 08712 262 091

Intellectual Property Awareness Network

Website: www.ipaware.net

Invest Northern Ireland

Website: www.investni.com

Phone: 0289 023 9090

Licensing Executives Society

Website: www.les-bi.org

Contact: [email protected]

Ofﬁce for Harmonisation in the Internal Market

Website: www.oami.europa.eu

Phone: +0034 96 513 9100

IP Health Check: Licensing IP

Intellectual Property Ofﬁce Information Centre

Website: www.ipo.gov.uk

Phone: 0300 300 2000

UK Trade and Investment

Website: www.uktradeinvest.gov.uk

Phone: 0207 215 8000

Phone: 0870 872 9000

UK Government Licensing Framework provides

a policy and legal overview for licensing the re-use of

public sector information, both in central government

and the wider public sector.

Website: www.nationalarchives.gov.uk/information-

management/uk-gov-licensing-framework.htm

IP Health Check: Licensing IP

History and

Acknowledgements

A Review of Intellectual Property for Her Majesty’s

Treasury by Andrew Gowers recommended that the

Intellectual Property Ofﬁce should develop resources

to assist small businesses in conducting Business-

to-Business IP licensing. To develop this project the

Intellectual Property Ofﬁce set up a working group

of external stakeholders with experience of, or an

involvement in, IP licensing. We would like to express

our sincere thanks to representatives of the following

organizations for participating in this work.

Anderson & Co

Animus

Biomedical Business Partners

BP plc

British Design Innovation

British Library

CBI

Ceres Power Ltd

Compgen Ltd

Ideas 21

Institute of International Licensing Practitioners

Institute of Patentees and Inventors

Intellectual Assets Centre, Scotland

Law Society

Licensing Executives Society

London Development Agency

NESTA

NHS National Innovation Centre

Northwood Reid

Procter and Gamble

Trademark Patents and Design Federation

IP Health Check: Licensing IP

Concept House

Cardiff Road

Newport

NP10 8QQ

Tel: 0300 300 2000

Fax: 01633 817 777

www.ipo.gov.uk

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please recycle it.

Revised: June 11

DPS/C450/07-13