Licensing Agreement (IP)
A Licensing Agreement (IP) is a legal document that enables a company to grant the use of its intellectual property to another business.
4.4 (50 reviews)
Last updated October 23, 2025
Under 15 minutes
Written by Edwin Montoya Zorrilla
Reviewed by Damin Murdock
Document Overview
An Intellectual Property Licensing Agreement is a legal document that enables a company (a licensor) to grant the exclusive or non-exclusive use of its intellectual property to another business (a licensee), and also allows the licensor to set out the terms associated with the use of its intellectual property.
However, unlike an Intellectual Property Assignment, an Intellectual Property Licensing Agreement does not allow a licensor to transfer ownership of the intellectual property to another person or business. The Intellectual Property Licensing Agreement merely grants the right to use the intellectual property under the terms set out in the agreement.
This legal document incorporates general legal matters relating to the execution and nature of the licence as well as the licensee’s obligations under the agreement; such as licence fees, confidentiality, indemnity and the expiration or termination of the licence.
Suitable for Australia
The Legal Risk Score of a Licensing Agreement (IP) Template
Our legal team have marked this document as medium risk considering:
- There is a risk related to the maintenance and inspection of records, as the licensee must maintain detailed financial records and allow inspections, which could impose significant administrative burdens..
- The document requires the licensee to immediately report any suspected or actual unauthorized use of trademarks, placing a proactive monitoring burden on them that could be resource-intensive.
- The document has comprehensive termination provisions.
Licensing Agreement (IP) Checklist
Complete your free Licensing Agreement (IP) with our checklist
Maintain Accurate Records
The licensee must keep detailed financial records as stipulated, which comply with Australian accounting standards for seven years.
Monitor and Report Trademark Use
The licensee is required to immediately report any suspected or actual unauthorized use of trademarks to the licensor.
Review and Adjust Compliance as Needed
Regularly review compliance with the agreement's terms to ensure all obligations and restrictions are met, adjusting processes as necessary to align with the agreement's requirements.
Use this Licensing Agreement If:
- You want to grant someone the use of your intellectual property, but do not want to transfer ownership of the intellectual property.
- You want to ensure that the person using your intellectual property uses it in a manner that was intended or agreed upon by you, and that they are aware of the consequences of non-compliance.
What does this Licensing Agreement cover?
- Duration, jurisdiction and nature of the licence.
- Nature of the intellectual property as well as its supply and use.
- Warranties and indemnities
- Licensee’s obligations: Licence Fees, Royalties, Stamp Duty, and GST.
- Expiration, termination and revocation of the licence.
Further Information:
View Sample Licensing Agreement (IP)
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