Sub Licence Agreement Template for Australia
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What is a Sub Licence Agreement?
The Sub Licence Agreement is a crucial document used when a licensee wishes to extend their licensed rights to third parties in Australia. This agreement is particularly relevant when companies need to expand their distribution networks, create strategic partnerships, or monetize their licensed intellectual property rights. The document carefully balances the interests of all parties while ensuring compliance with the head license terms and Australian legal requirements. It typically includes detailed provisions about the scope of rights, territorial limitations, quality control measures, reporting requirements, and commercial terms. The agreement must comply with Australian intellectual property laws, competition law, and relevant industry regulations, while also maintaining alignment with the head license terms. This type of agreement is commonly used in technology transfers, franchise arrangements, and intellectual property commercialization strategies.
About the Sub Licence Agreement
A Sub Licence Agreement is a legal document that allows you, as an original licensee, to grant specific rights from your head licence to third parties in Australia. This arrangement creates a three-way relationship between the head licensor, you as the sub-licensor, and your chosen sub-licensee, enabling you to expand your business reach while maintaining your obligations under the original licence.
When do you need this document?
You need a Sub Licence Agreement when expanding your licensed business operations through third parties. This commonly occurs in franchise arrangements where you hold master franchise rights and want to grant territorial sub-franchises. Technology companies use these agreements when licensing software or patents to distributors or resellers. Manufacturing businesses employ sub-licensing when allowing others to produce goods under their licensed designs or trademarks. You'll also need this document for strategic partnerships where sharing licensed intellectual property creates mutual business benefits, or when monetizing unused portions of your licensed territory or market segment.
Key legal considerations
Your Sub Licence Agreement must comply with the terms of your head licence, ensuring you have explicit authority to sub-license the rights. The scope of granted rights should be clearly defined, including territorial limitations, field of use restrictions, and duration constraints that don't exceed your head licence term. Quality control provisions are essential to maintain brand standards and protect the head licensor's interests. You must include appropriate indemnification clauses to protect yourself from sub-licensee breaches and ensure the sub-licensee assumes responsibility for their activities. Termination provisions should align with your head licence requirements, and you need mechanisms to terminate the sub-licence if your head licence ends. Revenue sharing arrangements with the head licensor must be clearly addressed, along with reporting obligations that may flow through from your original agreement.
Legal requirements in Australia
Australian law requires your Sub Licence Agreement to comply with the Copyright Act 1968 if involving copyrighted materials, ensuring proper attribution and scope limitations. For patented technology, the Patents Act 1990 governs your ability to sub-license patent rights and establishes validity requirements. Trademark sub-licensing falls under the Trade Marks Act 1995, requiring quality control measures and proper usage guidelines. The Competition and Consumer Act 2010 prohibits anti-competitive provisions, so you cannot include exclusive dealing arrangements or price fixing terms that restrict competition. Australian Consumer Law applies if your sub-licensee is considered a consumer, providing additional protections and fair trading requirements. Your agreement must also comply with Australian contract law principles, ensuring terms are clear, consideration exists, and the agreement is legally enforceable across all relevant jurisdictions.
GOVERNING LAW
Applicable law
This Sub Licence Agreement is drafted to comply with Australia law. Key legislation includes:
Patents Act 1990 (Cth): Relevant if the sub-license involves patented technology or innovations, governing the rights and transfer of patent licenses
Trade Marks Act 1995 (Cth): Applies to sub-licensing of trademark rights and usage conditions
Competition and Consumer Act 2010 (Cth): Ensures the sub-licensing agreement doesn't contain anti-competitive provisions and complies with Australian competition law
Australian Consumer Law (Schedule 2 of the Competition and Consumer Act): Provides consumer protections and fair trading provisions that may apply if the sub-licensee is considered a consumer
Contract Law - Australian Common Law: Governs the formation and enforcement of contracts, including principles of offer, acceptance, consideration, and terms
Personal Property Securities Act 2009 (Cth): May be relevant if the sub-license agreement creates security interests in intellectual property rights
Privacy Act 1988 (Cth): Relevant if the sub-license involves the handling of personal information or data
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