Royalty Bearing Licence for the United Kingdom

Royalty Bearing Licence Template for England and Wales

A Royalty Bearing Licence is a legal agreement under English and Welsh law that grants permission to use specific intellectual property rights in exchange for ongoing payments (royalties) based on agreed metrics such as sales, usage, or production. This agreement sets out the terms of use, payment structures, reporting requirements, and quality standards while protecting both parties' interests under UK jurisdiction.

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What is a Royalty Bearing Licence?

A Royalty Bearing Licence is commonly used when an intellectual property owner wishes to monetize their IP while maintaining ownership and control. Under English and Welsh law, this agreement type provides a framework for commercial exploitation of patents, copyrights, trademarks, or other IP rights in exchange for regular royalty payments. The document typically includes detailed provisions on payment calculations, reporting obligations, quality control, and termination rights, ensuring compliance with UK intellectual property and contract law principles.

What sections should be included in a Royalty Bearing Licence?

1. Parties: Identification and details of the licensor and licensee

2. Background: Context of the agreement and ownership of relevant IP rights

3. Definitions: Key terms used throughout the agreement

4. Grant of Rights: Scope of licence, territories, and field of use

5. Royalties: Payment terms, calculation methods, and reporting requirements

6. Duration and Termination: Term of agreement and circumstances for termination

7. Confidentiality: Protection of confidential information

8. Governing Law: Jurisdiction and applicable law

What sections are optional to include in a Royalty Bearing Licence?

1. Quality Control: Standards for licensed products, used when physical goods are involved

2. Sub-licensing Rights: Terms for sub-licensing, if permitted

3. Improvements: Rights to technological improvements, relevant for technical licences

4. Export Controls: Required for international licensing arrangements

What schedules should be included in a Royalty Bearing Licence?

1. Licensed IP: Detailed list of intellectual property covered by the licence

2. Royalty Calculations: Detailed methodology for calculating royalties

3. Reporting Template: Standard format for royalty reports

4. Quality Standards: Technical specifications and quality requirements

Authors

Alex Denne

Head of Growth (Open Source Law) @ Genie AI | 3 x UCL-Certified in Contract Law & Drafting | 4+ Years Managing 1M+ Legal Documents | Serial Founder & Legal AI Author

Jurisdiction

England and Wales

Publisher

Genie AI

Document Type

License Agreement

Cost

Free to use
Industries

Patents Act 1977: Primary legislation governing patent rights and their enforcement in the UK, essential for any patent licensing arrangements

Copyright, Designs and Patents Act 1988: Key legislation protecting copyright works, designs, and related intellectual property rights in the UK

Trade Marks Act 1994: Principal legislation governing trademark protection and licensing in the UK

Registered Designs Act 1949: Legislation protecting and regulating the use of registered designs in the UK

Common Law Confidential Information: Legal principles protecting confidential information and trade secrets under English common law

Unfair Contract Terms Act 1977: Legislation regulating unfair terms in contracts and limiting the extent to which liability can be excluded

Contracts (Rights of Third Parties) Act 1999: Legislation governing how third parties may enforce terms of a contract

Competition Act 1998: Primary UK competition law legislation affecting licensing agreements and market competition

Technology Transfer Block Exemption Regulation: Retained EU law providing safe harbor for certain technology licensing agreements from competition law restrictions

Income Tax Act 2007: Legislation governing the taxation of income, including royalty payments to individuals

Corporation Tax Act 2009: Legislation governing the taxation of companies, including corporate royalty payments

Value Added Tax Act 1994: Legislation governing VAT implications of royalty payments and licensing arrangements

Private International Law (Miscellaneous Provisions) Act 1995: Legislation governing choice of law rules for international contracts

Rome I Regulation: Retained EU law governing the choice of law in contractual obligations

UK GDPR: Data protection legislation governing the processing of personal data in the UK post-Brexit

Data Protection Act 2018: UK's implementation of data protection standards, working alongside UK GDPR

Teams

Employer, Employee, Start Date, Job Title, Department, Location, Probationary Period, Notice Period, Salary, Overtime, Vacation Pay, Statutory Holidays, Benefits, Bonus, Expenses, Working Hours, Rest Breaks,  Leaves of Absence, Confidentiality, Intellectual Property, Non-Solicitation, Non-Competition, Code of Conduct, Termination,  Severance Pay, Governing Law, Entire Agreemen

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