Sublicense Agreement: Sample

According to the license agreement, one party, acting as the owner exclusive right to a product of intellectual activity, transfers or agrees to provide the second party with the opportunity to use this product. The agreement defines the limits and conditions for the activities of the host party.

Key points

The participants in the license agreement are referred to as the licensor and licensee. In relation to the agreement they conclude, the general procedure is in force, providing for a written form and compulsory registration. If these conditions are not met, the contract may be declared null and void. Registration is also required for any changes to the agreement. The contract and the binding conditions for the parties come from the moment of conclusion.

Content of the agreement

The terms of the contract are defined in Art. 1235-1237 Civil Code. These include:

• Subject of the agreement. It should contain a description of the product of intellectual activity, the rights that are used, the number and date of receipt of the supporting document (sv, patent).
• Indication of parties to the agreement.
• The limits within which the right to use the product will be exercised.
• Ways to apply the result of intellectual activity.

In the absence of these clauses in the agreement, it shall be deemed not concluded.

Additionally

Another condition may be the definition of the territory in which the product is allowed to be used. If it is not installed, then the receiving party has the right to use the facility throughout the country. A license agreement can be concluded only within the time period during which the exclusive right is valid. Upon its termination, the agreement becomes invalid. If the document does not set a deadline, it is considered to be concluded for 5 years. The conditions also determine the amount of remuneration of the licensor and the procedure for its payment. In the absence of this clause, the agreement shall be deemed not concluded. An exception is a royalty-free license agreement.

Sublicense Agreement

This concept has long been used in business practice in relation to agreements on the use of products of intellectual activity. The procedure according to which a sublicensing agreement is concluded for the transfer of non-exclusive rights is regulated in the Civil Code. Its essence lies in the fact that the user provides the legal capabilities accepted by the owner (partially or completely) to a third party. In this case, the original owner must give written permission. In other words, a sublicense agreement acts as an assignment agreement. Often, it includes elements of transaction orders, agency services, etc.

Specificity

The ability to conclude a sublicensing agreement is provided for by Art. 1238 Civil Code. Such an agreement has a number of distinctive features. First of all, the licensee can transfer the rights to use the intellectual object or means of individualization to third parties only within the scope of the capabilities and means that were provided for in the license agreement. Equally important is the duration of the agreement. A sublicensing agreement, a model of which is presented in the article, concluded for a period exceeding the duration of the original document, is considered signed for the duration of the original transaction. The moment regarding liability is also specific. For the activities of third parties, the licensee will be responsible to the copyright holder, unless otherwise provided.Thus, the Civil Code establishes peremptory and dispositive provisions regarding the assignment agreement.

Software sublicense agreement

The sample of this document has little differences from the original agreement. It also, according to the requirements of the Civil Code, indicates the subject of the transaction. The text, in particular, states that the licensee agrees to transfer to the sub-licensee the right to use programs for PCs and databases under a simple license. The receiving party, in turn, undertakes to pay a fee determined by the terms of the transaction. The sublicensing agreement for software is widely used in the distribution system. Such an agreement makes it possible to optimize tax payments, since 26 paragraph 2 of Article 149 of the Tax Code provides for the exemption of the amounts of software sales for such transactions from VAT. The sublicense agreement acts as a derivative of the license. At its conclusion, opportunities are provided to the end user in a chain through a distributor. Thus, not only the owner, but also the reseller can use the VAT exemption.

Important point

It is necessary to distinguish a sublicense agreement from a sale. The last agreement is to ensure the correct design of "boxed" software. In a licensed relationship, the transfer of use rights is primary. Software instances are accepted by the user in order to fulfill their primary obligation. It should be said that these differences are conditional. In some cases, if necessary, the transfer of software as part of a software and hardware product can be issued in the form of a license.

Description of conditions

The sublicensing agreement provides that the name of the software, the number of copies, remuneration, other facts are indicated in the relevant acts of acceptance and transfer. These documents act as an integral part of the agreement from the moment of its conclusion. When these conditions are entered into the contract, experts recommend that they be reflected in additional acts. As mentioned above, mandatory items include a description of the product, the amount of remuneration. Acceptance and transfer acts will allow to comply with legal requirements and save time on the formation of the contract and its agreement with the counterparty. General conditions and methods of using the product, information about the territory and the period of validity of the document are recommended to be included directly in the text of the agreement.

Limitations

An indispensable condition on which the rights to use the product are granted is the unconditional acceptance and adherence to the agreement between the copyright holder and the end user. The third party in the transaction is an intermediary. He cannot get more rights than was granted by the copyright holder to the licensee.

Universal wording

The first of them concerns compliance with the requirements of the law on the procedure for signing and the content of the agreement. It sounds like this:

"The terms of the end-user agreement, accepted by the sub-licensee, act as an integral element of the agreement and prevail over the product specified in it."

The parties, therefore, cannot refer to other documents signed with third parties, if they are not included in the conditions. The second wording concerns the area of ​​application of the product. Unless otherwise provided by the original contract, the facility may be used throughout the country for the entire period in which the exclusive right is applicable. In the same paragraph, methods of application should be established. They may be reproduction and use in accordance with the functional purpose.

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