IP Due Diligence.
Before entering a significant licensing transaction, an IP due diligence engagement verifies title chain, validity risk, and existing encumbrances across the target portfolio.
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IP Licensing and Agreements
Intellectual property generates revenue only when rights are structured to move. A patent, trademark, copyright, or design registration becomes a commercial instrument through a correctly drafted licence or agreement. An agreement that omits statutory requirements or fails to address the governing register leaves the licensor exposed and the licensee without defensible rights. Intepat drafts, negotiates, and records IP licences across all four IP rights for Indian and foreign rights holders.
Speak with our IP TeamPatent Licence Recordal (s.69)
TM Registered-User Agreements
Copyright Licences (s.30)
Technology Transfer
FEMA Compliance
What IP licensing and agreements covers
Patent licences.
A patent licence grants permission to make, use, sell, or import a patented invention. The agreement must be in writing under Section 68 of the Patents Act, 1970, and the licensee must register the interest with the Controller under Section 69. Where the licence is not recorded, Section 69(5) restricts its use as evidence of title or interest unless leave is granted, creating evidentiary and priority risk. Where the patentee faces exposure to a compulsory licence application under Section 84 (available three years after grant where the invention is not worked in India), voluntary licences structured correctly address the working requirement.
Trademark licences and registered user agreements.
Permitted use under the Trade Marks Act, 1999 is governed by Sections 48 to 53. Recordal as a registered user under Section 49 is not mandatory (unregistered licensee use accrues to the proprietor), but a registered user acquires expanded litigation rights under Section 52. Quality control is structural: a licence without meaningful licensor oversight risks abandonment-by-naked-licence characterisation.
Copyright licences and assignments.
Section 30 of the Copyright Act, 1957 permits the owner to grant any interest by licence; Section 30A applies the Section 19 formality conditions (identification of the work, rights licensed, duration, territory, and royalty) to licences as well as assignments. Assignment and licensing carry different legal consequences and are not interchangeable. Design licences: The Designs Act, 2000 does not contain a standalone licensing regime; design licences are governed by contract against the registered right.
Cross-IP and technology transfer agreements.
Where the arrangement covers more than one IP type, a consolidated agreement addresses all elements with IP-specific formalities in parallel. Royalty remittances to foreign licensors under FEMA, 1999 are processed through an authorised dealer bank, subject to AD-bank documentation, withholding tax, the applicable double tax avoidance agreement, transfer pricing requirements for related-party arrangements, and any sector-specific restrictions.
The IP licensing process
1
Asset identification.
Registration numbers, filing dates, owner names, co-ownership, and prior encumbrances are confirmed across all assets in scope, with register entries verified at the Indian Patent Office, Trade Marks Registry, Register of Copyrights, and Designs Office as relevant.
2
Term sheet.
Exclusivity, territory, field of use, duration, royalty basis, sub-licensing authority, quality standards, and termination triggers are agreed before drafting begins. Ambiguity in commercial terms is the most common source of post-execution disputes.
3
Drafting, execution, and recordal.
The agreement is drafted against the commercial parameters and governing statute. Patent licences are recorded with the Controller under Section 69. Trademark licence recordal under Section 49 is filed jointly within six months; the application date is the effective date against third parties, published in the Trade Marks Journal. FEMA documentation and transfer pricing requirements are confirmed before any cross-border remittance.
How Intepat handles IP licensing and agreements
Patent licences are handled by Patent Agents registered under Section 125 of the Patents Act, 1970; trademark agreements by Trademark Agents registered under Section 145 of the Trade Marks Act, 1999; copyright and design agreements by senior attorneys. For cross-IP agreements, a coordinating counsel integrates all IP-right-specific formality requirements.
Each agreement is drafted from the term sheet parameters, with statutory defaults addressed expressly rather than left to operate silently. Key decisions (exclusivity scope, sub-licensing authority, royalty survival on reversion, termination for non-exercise) are confirmed before the first draft issues. Where the mandate follows an IP due diligence engagement, title and encumbrance findings are built directly into the drafting.
Documents and inputs required
Asset identification
registration certificates, application numbers, filing dates, registered owner names, and prior recorded interests for all assets in scope
Chain of title
employment agreements, commissioning agreements, prior assignments, and co-ownership records relevant to the grantor's authority
Parties’ details
legal names, jurisdiction of incorporation, signatory authority, and service address for each party
Commercial term sheet
exclusivity, territory, field of use, duration, royalty basis, sub-licensing authority, quality standards (trademark), audit rights, and termination triggers
Existing encumbrances
prior licences, security interests, and pending disputes affecting the assets
Cross-border parameters and authority
governing law, FEMA remittance route, applicable double tax avoidance agreement, and power of attorney in favour of Intepat counsel for recordal filings
Common pitfalls Intepat protects against
Unrecorded patent licences that are difficult to rely on.
Under Section 69(5) of the Patents Act, 1970, an unregistered patent licence document may not be admitted as evidence of title or interest unless the Controller or court grants leave. Recordal protects the licensee's register position and reduces evidentiary and priority risk against competing claimants.
Trademark licences without quality control.
A licence without meaningful licensor oversight risks characterisation as a naked licence. Uncontrolled use may not count as genuine proprietor-sanctioned use, creating non-use vulnerability. Quality standards and inspection rights are structural.
Copyright defaults operating silently.
Section 19(5) deems duration to be five years where not specified; Section 19(6) deems territory to be India only; Section 19(4) lapses rights not exercised within one year. Each omission produces consequences no party intended.
Sub-licensing authority assumed rather than granted.
Sub-licensing is not implied in Indian IP law. A licensee that grants sub-licences without express authority acts without right and may be in breach. Where the model requires sub-licensing to distributors or affiliates, the scope of authority and licensor approval rights are confirmed at term sheet stage and drafted in.
Who this is for
- Patentees commercialising registered patents through exclusive or non-exclusive licences to Indian or foreign licensees
- Foreign patent holders entering the Indian market through a licensing arrangement
- Trademark proprietors licensing brands to franchisees, distributors, or affiliates
- Technology companies entering technology transfer agreements with industry partners, including cross-border intra-group arrangements
- Publishers, production houses, and software companies structuring copyright licences for content distribution or platform agreements
- Private equity and strategic acquirers requiring existing licence agreements reviewed as part of a transaction
- In-house IP counsel managing multi-jurisdictional portfolios requiring India-side recordal and local counsel representation
Related IP services
IP Licensing and Agreements FAQs
Does a patent licence need to be registered in India, and what happens if it is not?
Under Section 68 of the Patents Act, 1970, a patent licence must be in writing, must embody the agreed terms, and must be duly executed. Under Section 69(1), the licensee must apply to the Controller to register the licence interest. Where the licence is not recorded, Section 69(5) restricts reliance on it as evidence of title or interest unless the Controller or court grants leave.
Is trademark licence recordal mandatory in India, and what does registered user status confer?
Recordal is not mandatory under the Trade Marks Act, 1999. Use by an authorised unregistered licensee accrues to the proprietor under the extended definition of permitted use. However, under Section 52 a registered user may institute infringement proceedings in their own name, making the registered proprietor a defendant. The joint application for recordal is filed by both parties; the effective date against third parties is the application date.
What are the statutory content requirements for a copyright licence in India?
Under Section 30 read with Section 30A of the Copyright Act, 1957, a copyright licence must be in writing, signed by the licensor, and must specify the rights granted, duration, territory, and royalty. Where duration is omitted, Section 19(5) deems it five years. Where territory is omitted, Section 19(6) deems it India only. Section 19(4) lapses rights not exercised within one year unless the deed addresses the contingency.
How are royalty payments to overseas licensors treated under Indian exchange control law?
Royalty payments to foreign licensors are current account transactions under FEMA, 1999, processed through an authorised dealer bank. The remittance requires the executed agreement, a commercial invoice, and a tax deduction certificate where withholding applies under the Income Tax Act, 1961 or an applicable double tax avoidance agreement. Transfer pricing documentation is required for intra-group transactions. Sector-specific restrictions may apply and should be confirmed before executing the arrangement.
What is a compulsory licence, and how does voluntary licensing interact with it?
Under Section 84(1) of the Patents Act, 1970, any person may apply for a compulsory licence three years after grant where public requirements are not satisfied, the invention is not available at a reasonably affordable price, or the invention is not worked in India. A patentee who has granted voluntary licences on commercially reasonable terms with active working in India is better placed to resist a Section 84 application than one relying on importation.
Can a licensee grant sub-licences, and how is that authority established?
Sub-licensing authority is not implied in Indian IP law. A licensee can grant sub-licences only if the head licence expressly authorises it, and only to the extent authorised. Sub-licences beyond that authority are unenforceable against the licensor and may constitute a breach. Where the business model requires sub-licensing to distributors, franchisees, or affiliates, the scope of authority and licensor approval rights are addressed at term sheet stage and drafted in expressly.
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