License agreement - ( Art. 1235 Civil Code) a contract under which one party - the owner of the exclusive rights to results of intellectual activity or means of individualization (licensor) grants or agrees to grant to the other party (the licensee) the right to use such a result of such funds provided contractual limits.
Is your intellectual property realising its true value?
As the owner of any intellectual property right, be it patent, trademark, copyright, software or even plant variety, you can exploit that right for gain in any legal way you see fit. One simple method of doing so, which allows you to generate a revenue stream from the right, whilst someone else puts in the hard work to realise earnings from the right is to license this it to a third party. This allows them to utilise the right, under strict conditions specified and agreed upon by both parties. This differs slightly from a Franchise agreement in that it is regarding only one specific intellectual property and provision for how this is used is stipulated exclusively in the agreement. Any ancillary use not specified is not allowed and in breach of the said agreement.
Be sure what you want to allow, and what you do not
As you would expect when dealing with such an agreement, the terms are intended to be strict and specific. If they are not it is likely that this agreement can be exploited by those you have granted the license to. If you want to ensure that your agreement covers the rights you wish to grant and no more, you must have the agreement drawn up by experienced legal professionals. License agreements must be made in written format and as they are regarding intellectual property, must also be submitted to Rospatent for registration. Agreements licensing rights which have not already been correctly registered with Rospatent will not be valid.
License agreements can be as simple or as complicated as one needs or wants, but it becomes more challenging when considering the intention of the licensor and licensee. You must consider the length of the agreement, the territory under which it is applicable. Is the right to be used exclusively or not. If exclusive this may preclude the licensor themselves for using the right in the territory stipulated in the agreement.
Don’t let country borders be barriers to business
Foreign licensors can license their rights to third parties in the Russian Federation, directly or through a joint venture or by establishing a subsidiary. This makes it a very flexible model for expanding and operating in the Russian Federation with a sliding scale of risk and reward. However, these business entities must conform to Russian law by passing general tests on areas such as taxation, investment and antimonopoly. Consideration for these tests may require special filings or licence, registration and or a regulatory review.
Whilst there is nothing inherently complex about this area of intellectual property law, there is a multitude of considerations which could potentially trip you up as the licensor or licensee. Especially if you are operating from outside the Russian Federation. Consult us regarding any aspect of your licensing requirements and we can draft that agreement according to your wishes. We are also able to prepare and file any necessary documents to support registration of the agreement.
- consulting on all issues related to the licensing;
- drafting of the license agreement, with its further approval by the client and a Russian Patent Office expert;
- preparing and filing of the necessary documents for registering the license agreement.