Patent licence agreement

The patent licence agreement is an intellectual property contract. Through it, the holder of a patent grants one or more persons, the licensees, the enjoyment of its exclusive right of exploitation or of some of its uses. Unlike the assignment, the licence does not transfer the patent. The title remains in the estate of its holder.

How the licence works

In other words, the licence allows a third party to exploit a patented invention. In return, it pays a royalty or other remuneration. The holder, called the licensor, authorises the licensee to exploit the invention in a defined field or for a defined duration.

The licence may be exclusive or non-exclusive. In an exclusive licence, the licensor reserves to the licensee the right to manufacture, sell and use the invention within the agreed scope. In a non-exclusive licence, by contrast, it may grant licences to several third parties.

The uses of the patent licence

Patent licences serve a variety of needs. A company may take a licence to manufacture a product or provide a service based on the invention. A researcher may obtain one to pursue work on the invention. These contracts are frequent in sectors where research is costly and collaboration benefits everyone, such as pharmaceuticals. Finally, the licence often makes it possible to settle an infringement dispute amicably and avoid costly proceedings. In every case, its drafting is best entrusted to a patent attorney.

To go further: our overview of intellectual property contracts.