Non Exclusive Trademark License Agreement Template for Malaysia

A non-exclusive trademark license agreement is a legal contract that grants you permission to use another party's registered trademark while allowing the trademark owner to license the same mark to other businesses. Under Malaysia's Trademarks Act 2019, this arrangement provides a flexible framework for brand expansion and intellectual property monetization while ensuring proper legal protection for all parties involved.

When do you need this document?

You need this agreement when entering into licensing arrangements where multiple parties may use the same trademark. Franchise operations commonly use non-exclusive licenses to allow multiple franchisees to operate under the same brand within different territories. Manufacturing companies may license their trademarks to various distributors or retailers across Malaysia and neighboring regions. Technology companies often use these agreements when allowing multiple software developers to incorporate their branded components. Additionally, you need this document when expanding your business through strategic partnerships where brand sharing enhances market penetration while maintaining competitive flexibility for the trademark owner.

Key legal considerations

Your agreement must clearly define the scope of trademark usage, including specific products or services covered, geographical territories, and duration of the license. Quality control provisions are essential to protect the trademark's reputation and value, requiring you to maintain standards that align with the licensor's brand image. Royalty structures need precise definition, including payment schedules, calculation methods, and reporting requirements. Termination clauses should specify conditions under which either party may end the agreement, including breach scenarios and notice periods. You must also address trademark registration obligations, ensuring the licensee acknowledges the licensor's ownership and agrees not to challenge trademark validity. Non-compete provisions may apply to prevent conflicts of interest, while indemnification clauses protect against trademark infringement claims.

Legal requirements in Malaysia

Under the Trademarks Act 2019, your license agreement must comply with registered trademark requirements and may need registration with the Intellectual Property Corporation of Malaysia for certain enforceability benefits. The Contracts Act 1950 governs the fundamental validity of your agreement, requiring proper offer, acceptance, consideration, and capacity of parties. You must ensure compliance with the Competition Act 2010, avoiding anti-competitive provisions that could restrict fair market competition. The Trade Descriptions Act 2011 requires accurate representation of licensed products and services. Your agreement should include proper identification of all parties with Malaysian registration numbers and addresses. Consider stamp duty obligations under the Stamp Act 1949 for executed agreements. Additionally, ensure your contract includes governing law clauses specifying Malaysian jurisdiction and dispute resolution mechanisms that align with local legal procedures.