Royalty Licence Template for England and Wales

A Royalty Licence agreement under English and Welsh law is a legal document that grants permission to use intellectual property rights in exchange for royalty payments. It establishes the terms of use, payment structures, and obligations between the licensor and licensee. The agreement covers specific rights granted, territorial limitations, quality control measures, and reporting requirements, all while ensuring compliance with UK intellectual property and competition laws.

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What is a Royalty Licence?

A Royalty Licence is essential when one party wishes to monetize their intellectual property by allowing others to use it in exchange for payments. This agreement, governed by English and Welsh law, defines the scope of permitted use, payment terms, and obligations of both parties. It's commonly used for licensing patents, trademarks, copyrights, and other intellectual property rights. The document includes detailed provisions for calculating and paying royalties, reporting requirements, quality control measures, and termination rights.

What sections should be included in a Royalty Licence?

1. Parties: Identification and details of the licensor and licensee, including registered addresses and company numbers

2. Background: Context of the agreement, ownership confirmation of IP rights, and purpose of the licence

3. Definitions: Defined terms used throughout the agreement including Licensed IP, Territory, Royalties, Net Sales

4. Grant of Rights: Scope of licence, territories covered, and permitted uses of the licensed IP

5. Royalty Payments: Payment terms, calculation methods, payment frequency, and reporting requirements

6. Duration and Termination: Term of licence, renewal provisions, and circumstances for termination

7. Warranties and Indemnities: Legal promises regarding IP ownership and protection against claims

8. Confidentiality: Obligations regarding confidential information shared during the agreement

9. Governing Law and Jurisdiction: Specification of English and Welsh law as governing law and jurisdiction for disputes

What sections are optional to include in a Royalty Licence?

1. Quality Control: Standards and requirements for licensed products or services, including approval processes

2. Minimum Performance Requirements: Minimum sales targets, revenue requirements, or other performance metrics

3. Sub-licensing Rights: Terms and conditions under which the licensee may grant sub-licences

4. Marketing and Promotion: Requirements and restrictions regarding marketing of licensed products

5. Audit Rights: Rights of licensor to audit licensee's books and records

What schedules should be included in a Royalty Licence?

1. Schedule 1 - Licensed IP: Detailed description of intellectual property being licensed including registration numbers

2. Schedule 2 - Royalty Rates: Detailed breakdown of royalty rates, calculation methods, and payment thresholds

3. Schedule 3 - Territories: List of geographical territories where licence is valid

4. Schedule 4 - Reporting Template: Standard format for royalty reporting and calculations

5. Schedule 5 - Quality Standards: Detailed quality requirements and specifications for licensed products

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

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Free to use

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White Label Software Licence Agreement

An England & Wales agreement allowing businesses to rebrand and license software under their own identity.

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Download a Standard Royalty Licence

Review your own Royalty Licence

What is a Royalty Licence?

What sections should be included in a Royalty Licence?

What sections are optional to include in a Royalty Licence?

What schedules should be included in a Royalty Licence?

Authors

Alex Denne

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