Third Party Licence Agreement for the United Kingdom

Third Party Licence Agreement Template for England and Wales

A Third Party Licence Agreement under English and Welsh law is a legally binding contract that enables a licensee to extend certain licensed rights to specified third parties. This agreement defines the terms under which intellectual property, technology, or other assets can be used by parties beyond the primary licensee, while maintaining the licensor's control and protecting their interests. It includes specific provisions for liability, compliance, and termination rights, structured within the framework of English and Welsh contract law.

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What is a Third Party Licence Agreement?

Third Party Licence Agreements are essential when businesses need to extend licensed rights beyond the primary licensee. This document type is commonly used in situations where a licensee requires the ability to sublicense or grant access to licensed properties to specific third parties, such as subsidiaries, contractors, or customers. The agreement, governed by English and Welsh law, typically includes detailed provisions on the scope of third-party rights, usage limitations, quality control measures, and liability allocation. It's particularly important in complex commercial arrangements where multiple parties need access to licensed intellectual property or other assets.

What sections should be included in a Third Party Licence Agreement?

1. Parties: Identification of all contracting parties including licensor, licensee, and relevant third parties

2. Background: Context of the agreement and relationship between parties

3. Definitions: Key terms used throughout the agreement

4. Grant of Licence: Scope and nature of the licence being granted

5. Term and Termination: Duration of agreement and termination provisions

6. Payment Terms: Financial arrangements including fees and payment schedule

7. Intellectual Property Rights: Ownership and protection of IP rights

8. Warranties and Representations: Promises and statements made by each party

9. Indemnification: Protection against third-party claims and losses

10. Confidentiality: Protection of confidential information

11. General Provisions: Standard boilerplate clauses including governing law, notices, and assignment

What sections are optional to include in a Third Party Licence Agreement?

1. Territory Restrictions: Geographic limitations on licence use - include when licence is geographically restricted

2. Sublicencing Rights: Rights to grant sublicences to others - include when sublicencing may be permitted

3. Quality Control: Standards maintenance requirements - include for brand-sensitive licences

4. Data Protection: Specific provisions for handling personal data - include when personal data processing is involved

5. Export Control: Compliance with export regulations - include for international licensing

What schedules should be included in a Third Party Licence Agreement?

1. Schedule 1 - Licensed Properties: Detailed list and description of licensed items/properties

2. Schedule 2 - Royalty Calculations: Detailed breakdown of payment calculations and reporting requirements

3. Schedule 3 - Technical Specifications: Technical requirements and standards for licensed properties

4. Schedule 4 - Approved Third Parties: List of approved third party users or sublicencees

5. Schedule 5 - Service Levels: Performance standards and metrics if applicable

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
Relevant legal definitions
Clauses
Industries

Contracts (Rights of Third Parties) Act 1999: Key legislation governing how third parties may enforce terms of contracts. Essential for third party licence agreements as it determines rights of parties not directly party to the contract.

Copyright, Designs and Patents Act 1988: Primary legislation governing intellectual property rights including copyright protection, crucial for defining the scope of licensed materials.

Trade Marks Act 1994: Legislation governing trademark protection and usage, important for any licensed trademarks or branded elements.

Patents Act 1977: Controls patent rights and licensing in the UK, relevant if the license involves patented technology.

Database Rights: Retained EU law protecting rights in databases, important if the license involves access to or use of databases.

Competition Act 1998: Ensures license terms do not create anti-competitive effects or market restrictions.

Enterprise Act 2002: Provides framework for market regulation and competition law, relevant for ensuring license terms are not anti-competitive.

Consumer Rights Act 2015: Protects consumer interests if the license agreement affects end users who are consumers.

Consumer Protection from Unfair Trading Regulations 2008: Protects against unfair commercial practices, relevant if license impacts consumer-facing activities.

UK GDPR: Data protection regulation governing handling of personal data, crucial if license involves data processing.

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

Common Law Contract Principles: Fundamental principles covering contract formation, consideration, privity, breach and remedies in English law.

Industry-Specific Regulations: Sector-specific rules and regulations that may apply depending on the industry (e.g., financial services, healthcare).

International Trade Regulations: Regulations governing cross-border trade and transactions if the license has international elements.

Export Control Regulations: Controls on the export of certain goods, technology, or information that might be subject to licensing.

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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