In a previous article “Perpetual contracts: can they be terminated?”, the termination of contracts with no agreed end date or provisions governing termination was discussed. Term and termination are key issues that need to be carefully considered and clearly addressed in IP licences. In particular, trade marks are capable of being registered in perpetuity provided the relevant fees are paid. Therefore, trade mark licences may potentially be perpetual in term.
The term of a licence agreement generally refers to the period of rights granted to the licensee for the exploitation of the licensed IP (such as trade marks) and other related obligations. In the context of trade mark licences, if the licence term is long, it is highly recommended that the parties consider and include mechanisms to address any change in commercial and business circumstances and prospects of further expansion of goods and services to be offered and market segments.
The following cases reinforce the importance of considering the term, termination rights and consequences of trade mark licences. Read more