Technology licensing

Technology licensing is a contractual arrangement in which the licensor's patents, trademarks, service marks, copyrights, trade secrets, or other ..... property may be sold or made available to a licensee for compensation that is negotiated in advance between the parties.

This compensation, or royalties, may be a ..... sum royalty, a running royalty (royalty that is based on volume of production), or a combination of both.

A technology licensing agreement usually enables a firm to enter a foreign market quickly, and ..... fewer financial and legal risks than owning and operating a foreign manufacturing facility or participating in an overseas joint venture.

Licensing also permits U.S. firms to overcome many of the tariff and nontariff barriers that frequently ..... the export of U.S. manufactured products.

Technology licensing can also be used to acquire foreign technology, such as ..... agreements awarding rights to improved technology developed by a licensee.

Franchising is also an important form of technology licensing used by many service industries, where the franchisor (licensor) permits the franchisee (licensee) to employ its trademark or service mark in a contractually ..... manner for the marketing of goods or services.

As a form of 'exporting', technology licensing has certain potential .....: one negative aspect of licensing is that control over the technology is weakened because it has been transferred to an unaffiliated firm.

In considering the licensing of technology, it is important to remember that foreign licensees may attempt to use the licensed technology to manufacture products in direct ..... with the licensor or its other licensees.

In many instances, U.S. licensors may wish to ..... territorial restrictions on their foreign licensees, depending on U.S. and foreign antitrust laws as well as the licensing laws of the host country.

Also, U.S. and foreign patent, trademark, and copyright laws can often be used to bar unauthorized sales by foreign licensees, provided that the U.S. licensor has valid patent, trademark, or copyright protection in the United States or the other ..... countries.