Licensing of trademarks in India – IICJ

What is trademark licensing

At its simplest, trademark licensing is permission granted by a trademark owner (licensor) to another (licensee) to use the licensor’s trademark on mutually agreed terms and conditions. Consistent with the origin-function of a trademark, the licensor must remain in control of the nature and quality of the licensed goods or services to prevent false or deceptive representation resulting from the licensee as a source of such goods or services. The licensor’s quality control and connection with the licensee’s goods or services lie at the core of valid trademark licensing and ensure consistent standards of quality of goods or services offered.

This legal arrangement serves as a bridge between the licensors and potential market opportunities, enabling the trademark owners to benefit from expanded reach of the trademark by way of additional revenue, while maintaining control over the trademark’s integrity and associated goodwill with or without direct or indirect operational involvement. On the other hand, the licensees benefit from the established market presence and reputation of recognized trademarks. The arrangement fuels innovation, encourages cross-industry collaborations, and contributes to broader economic growth while maintaining the essential origin function of trademarks in contemporary commerce.