A trademark license is a legal agreement between two parties in which the owner allows another party to use its trademark in exchange for compensation. This can be a very beneficial arrangement for both parties involved.
It can help the trademark owner generate revenue while also protecting its trademark. The party receiving the license can also benefit by being able to use a well-known trademark to help promote its products or services.
If you want to license your trademark, it is crucial to do so correctly. Here are some ways to help ensure the process goes smoothly with trademark license requirements.
Different Types of Trademark Licenses
Here are different types of trademark licenses to choose from.
Sole License: The licensee and the licensor own the rights to use the mark. After this, no more licenses can be granted for the same mark.
Exclusive License: the licensee owns the sole commercial rights over the trademark and deals with the profits and losses. There are no benefits to the licensor except for a fee upon agreement.
Non-exclusive License: Anyone may use the trademark if they agree to the required conditions.
How Can You Ensure a Trademark License is Done Properly?
A legally binding agreement will protect intellectual property while allowing another company to use it. You may need a checklist when learning to get a trademark license. Here's what you should do to ensure everything goes smoothly.
Both licensee and licenser must set terms on the use of the trademark and the responsibilities that come under the agreement. The licensee must ensure the brand's reputation and meet the set requirements. Moreover, the licenser may set prohibitions related to the use of the trademark or colour of the logo.
For legal safety, you should have a trademark licensing agreement that both the licensee and licensor sign. It must include the following:
- Names of both parties involved and trademarks to be agreed on.
- It should specify the type of license, product and services attached to the trademark, and geographical location.
- There should be payment details and date of use for the trademark.
Work with a trademark attorney.
Trademark agreements involve several legal aspects that a professional attorney should address. The legal attorney will ensure fewer challenges from documentation to drafting the agreement.
When you own a business, you may need to learn how to handle business partner disagreements. An attorney may also help diffuse tension and mediate legal requirements between the two parties.
The guidelines should have details of how the trademark will be used. It must align with your brand and represent your vision. You may ensure there are no unnecessary changes done to the trademark.
What are the Benefits of a Trademark License?
There are a few benefits to having a trademark license.
- It can help you protect your trademark. When you license your trademark to another company, they can use it in connection with their products or services. This can help you to expand your reach and protect your trademark from being used by someone else.
- A trademark license can help you to generate revenue. The other company will typically pay you a royalty for using your trademark
- Getting a trademark license may help you build a stronger relationship with your customers and reach new markets.
- A trademark agreement will make your work legal and prevent it from being deemed an infringement.
Disadvantages of not having a Trademark License
Without the protection of a trademark license, companies risk losing their valuable brand. Without a trademark license, competitors could use a business name, logo, or other identifying marks, leading to confusion and a potential loss of customers.
If a business doesn't have a trademark license, it can’t enforce its rights, meaning it may have to face costly legal fees and could even lose its valuable trademarks. You may need a trademark attorney to ensure you don't incur any financial damage.
You may need a trademark lawyer to draw the terms and conditions when working on a trademark license agreement. For this, Mishoura can provide you with a platform to find the right attorneys to ensure trademark licensing is done correctly and protects you legally. Connect with Mishoura today to speak to an expert.
Written By -
CEO & Founder at Mishoura.com