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Licensing Your Intellectual Property

Intellectual property, or IP, is intangible property that is the result of creativity, that can be owned by a person or a company. Intellectual property includes patents, trademarks, and copyrights. One way to secure and protect your intellectual property (and make money with it) is through licensing – selling the rights to use it to someone else. Here’s what you need to know about licensing intellectual property and its benefits.

What Is Licensing Intellectual Property?

Licensing is when an individual or business (the licensor) grants someone else (the licensee) permission to use their original ideas, such as literary, artistic or scientific works and inventions, that are protected by copyright or patent laws.

There are three types of licensing in Australia: exclusive, non-exclusive, and sole licensing:

  • Exclusive licensors give one company permission to market a product using the licensor’s intellectual property exclusively.
  • A non-exclusive license allows for multiple companies to market similar products using that licensor’s intellectual property without receiving permission from that licensor separately for each use.
  • Sole licenses are a combine exclusive and non-exclusive licenses, where both the licensor and the licensee can use the licensor’s intellectual property.

Commercial License Agreements

It is important that the rights and obligations of both the licensor and licensee with respect to the intellectual property being licensed are clearly set out in a legally binding agreement.

A commercial license agreement can set out the use of the licensed intellectual property under certain conditions. These can include both geographic location and time period for which exclusivity is granted. For example, a company could have been granted rights to distribute specific products in Europe for five years.

What Types of Intellectual Property Can Be Licensed?

There are many different types of intellectual property (IP) that can be licensed, including trade marks, copyrights, patents, and trade secrets. A patent on a particular invention will generally last for 20 years from when it was originally filed with IP Australia. However, some patents for pharmaceutical substances can last up to 25 years. You could also license your IP but keep exclusive ownership in order to sell it yourself later if it proves popular enough after being exploited by someone else under license.

The Benefits of Licensing Your Intellectual Property

No matter what business you’re in, from retail to technology, your intellectual property can be a powerful asset. By licensing your IP instead of trying to commercialise it on your own, you have an opportunity to expand its reach beyond your own company and tap into new revenue streams. Licensing your IP is a fantastic marketing opportunity and can create avenues for entering foreign markets. With a license agreement in place, you could earn royalties on each sale, creating the potential for passive income.

If you are interested in licensing your intellectual property, get in touch with our team today. You can call us in Melbourne on (03) 8538 1676, in Sydney on (02) 9233 4266, or submit an online enquiry below:

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