Non Exclusive Trademark License Agreement Template for Canada

A Non Exclusive Trademark License Agreement is a legal contract that allows you to grant permission to multiple parties to use your trademark while retaining ownership and control over the mark. Unlike exclusive licensing arrangements, this agreement preserves your right to license the same trademark to additional parties and continue using it yourself. This flexibility makes it an ideal tool for businesses looking to expand their market reach through strategic partnerships while maintaining maximum control over their intellectual property assets.

When do you need this document?

You need this agreement when you want to allow other businesses to use your trademark for specific products or services while keeping the door open for additional licensing opportunities. This is particularly valuable for franchising operations, where you grant trademark rights to multiple franchisees across different territories. The agreement is also essential when you're licensing your brand to manufacturers who will produce goods bearing your trademark, or when partnering with distributors who need trademark rights to market your products effectively. Additionally, you'll need this document when expanding into new markets where local partners require trademark usage rights to represent your brand authentically.

Key legal considerations

Quality control provisions are absolutely critical in your agreement, as Canadian trademark law requires licensors to maintain control over the nature and quality of goods and services provided under the licensed mark. Without adequate quality control measures, you risk losing your trademark rights entirely. Your agreement must clearly define the licensed products or services, specify quality standards, and establish inspection procedures. Territory restrictions should be precisely defined to avoid conflicts between multiple licensees. Royalty structures need careful consideration to ensure compliance with competition law and fair dealing principles. The agreement should also address termination procedures, including what happens to existing inventory and ongoing obligations when the relationship ends.

Legal requirements in Canada

Under the Trademarks Act, you must ensure that any licensing arrangement maintains the connection between your trademark and your business. This means implementing robust quality control measures and regularly monitoring your licensee's use of the mark. The Competition Act requires that licensing terms don't create anti-competitive conditions or unfair market restrictions, particularly regarding territorial divisions and pricing arrangements. Provincial contract law governs the formation and enforcement of the agreement, requiring clear terms, mutual consideration, and proper execution procedures. You must also consider provincial business practices legislation, which varies by province but generally requires fair dealing and transparency in commercial relationships. Additionally, if the agreement involves personal information collection or electronic transactions, compliance with privacy legislation may be required.