Updated : April 10, 2023Trademark Licensing in India : Process, Registration, and Cancellation
Trademark licensing is a popular practice by which trademark owners allow other entities to use their trademark in connection to specific goods or services. While the user only receives the right to usership of the mark in exchange for some kind of monetary compensation paid to the owner, the owner shall retain his exclusive right to ownership of the mark.
Trademark licensing can be beneficial for both the user and the owner of the mark. While the user can enhance the credibility and consumer base of his business by using a well known and established trademark, the owner on the other hand, can generate additional revenue and potentially expand the reach of his business’s brand to new consumers.
However, it is important to note that trademark licensing involves complex legal procedures and a complete knowledge of such procedures is absolutely necessary before you get involved into it.
Legal Provisions for Trademark Licensing
Trademark licensing is legally permitted under Section 49 of the Trademark Act, 1999. According to this section, a registered trademark owner can grant a licence to another entity to use their trademark in connection to specific goods and services. However, for this, a written licensing agreement will have to be signed between both the parties. The agreement must include the following details :
- Duration of the licence
- Territory where the licence shall be valid
- Quality control measures to ensure that products or services for which the licensed trademark shall be used meet the standards of the trademark’s owner
- Royalty or compensation paid to the trademark owner in exchange for the licence
Trademark License Registration Process
Once the licensing agreement is signed between both the parties, it will have to be registered with the appropriate authority. For this, the trademark owner must file an application to the jurisdictional Trademark Registrar. The application must include a copy of the licence agreement and details of the trademark’s registration. Once the application is approved, the trademark licence will be recorded in the concerned Trademark Registry.
Cancellation of Trademark License
If a trademark owner wishes to cancel a trademark licence or revoke the usership rights given to the registered user, he must file a petition with the Trademark Registrar. The petition must include the grounds for cancellation, such as the failure of the licensed entity to comply with quality control measures or the expiration of the licence agreement. Once the petition is approved, the trademark licence will be cancelled by the Registrar, and the registered user will no longer have the right to use the concerned trademark.
Trademark Licensing in India presents a dynamic opportunity for trademark owners and potential users alike. By carefully navigating the legal provisions of the Trademark Act, 1999, and entering into well-drafted trademark licensing agreements, brand owners can expand their market presence and revenue streams. At the same time, aspiring entrepreneurs can enhance their brand image and gain consumer trust by associating with well-known and established trademarks. To unlock the full potential of trademark licensing in India, businesses must approach it diligently, seeking expert legal advice and ensuring compliance with the Trademark Act.
