The licence agreement

Licences are a much misunderstood topic. A licence is often thought to be a right of property, which is not the case, although some learned authors do strongly argue in favour of such an approach.

The generally-accepted approach is that a licence is a promise from the owner of an intellectual property right that the licensee, for example a user of particular software, will not be accused of infringing the intellectual property right in question.

The fact that a licence is nothing more than an agreement not to bother the licensee can come as a disappointment if the licence is granted by a company that later becomes insolvent. Any new

owner of the intellectual property right can claim that he is not bound by the agreement to tolerate use by the other party. This causes a problem as no-one wants to pay for the same user rights twice.

Often such a situation resolves itself due to the fact that the new owner does not want to lose credibility as a supplier. New owners are unlikely to make difficulties with companies that have always paid properly for the use of software, but practical problems can arise with regard to products that are built in, for example in cars, trucks or ICT products.

If the use of an intellectual property right is absolutely crucial, it may be possible to negotiate a pledge over the specific intellectual property right. Another possibility is to negotiate shared ownership, which will be subject to extensive restrictions.

If you work with licences that are of significant economic value to you, it is sensible to supplement your financial agreements regarding licences with deliberate choices about the legal methods by which your rights are secured.