A trademark license, as the name suggests, is a mutual agreement between the licensor (the trademark owner) and the licensee (another party) on the usage of trademark in commerce. The ownership of the trademark however, is retained by the owner only in the licensing of trademark.
The licensing of trademarks plays a critical role in the manner goods and services are marketed, distributed and sold not only nationally but internationally as well.
Provisions provided to the licensor of trademark:
1- Licensor has the provision to keep a quality control check over the good or services produced or offered by the licensee.
2- Provisions to govern the tenure of the license agreement.
3- Provisions to govern the territory mentioned in the license.
4- Provisions may include the royalty rate that a licensee has to pay to the licensor in lieu of the use of the trademark.
5- SProvisions to record the license.
6- Provisions to govern the jurisdictions mentioned in the license.
7- Provisions to govern the exclusive rights to use the trademark by the licensee.