A license is a permission to use a software application, a trademark, a patent or other intellectual property rights. Licensing of such rights is normally documented in the form of an agreement between the owner of the right (licensor) and one or more licensees regarding the right to exploit the right.

Mann signerer avtale

Different types of licensing

Intellectual property rights can form the basis for licensing in various ways:

  • One-way licensing (in or out)
  • License as basis for sub-licenses
  • Cross-licensing: Companies holding patents in adjacent technology areas can license to each other, allowing for better technology utilization

Benefits of Licensing

It can be difficult for companies without sufficient financial "muscles" to fully exploit an idea with a large market potential. Licensing can still provide increased utilization.

By licensing out your exclusive rights, you can get others to sell your products in countries where you yourself are not present. This is how you can increase earnings.

By licensing out to an established company, you don't have to take responsibility for production, sales and marketing yourself. It is therefore cheaper and faster.

VedBy licensing out, you can get income from industries you don't work in yourself. For example, you could make and sell brakes for off-road bikes, but license it to someone who makes motorcycle brakes.

If you find useful technology from others, you can license it in, and thus enter the market faster with lower development costs than you would have by making everything yourself.

Licensing in a nutshell

Licensing means that the costs and risks of production and marketing are distributed between the parties.


Payment of license

The payment can take place in various ways, but it is common to make a one-off payment, pay royalties (which are payments related to the sale of products produced using the right or a combination of these.

– The market for liquid solar is growing strongly worldwide, and thus there is also great competition around developing the best technology.

We have patented our technology and use the patents actively to enter into license agreements with developers of power plants, as well as to avoid copying. The license income provides us with the opportunity to further develop the technology such that we always have the best system.

Børge Bjørneklett

Founder & CEO Ocean Sun


Børge Bjørneklett

Founder & CEO Ocean Sun

What should a license agreement contain?

Negotiating the license terms is a complex and often lengthy process. The license is a binding legal document, so it is important that the content is well thought out. You should involve a lawyer, a patent attorney or other legal advisors with knowledge of patents and licensing if you do not have this knowledge yourself.

These are elements that are usually considered in license agreements (the list is not exhaustive):

  • The scope of the license; all or only parts of the right and its scope of protection
  • Degree of exclusivity: exclusive, non-exclusive, may also have conditions for maintaining exclusivity over time
  • Does it grant the right to grant sub-licenses, in which case with what restrictions?
  • For which geographical area should the license apply?
  • What kind of information must the licensor provide?
  • Who covers the costs of any interventions?
  • who has the right to make improvements/changes?
  • Is the licensor responsible for technical or other assistance?
  • What are the payment and terms of payment (one-time/incremental/royalty)?
  • Right to insight into accounts?

Remember to report licenses to the Norwegian Industrial Property Office

Records of license agreements in the Norwegian Industrial Property Office 's registers provides legal protection in the event of conflicts of rights.

The Norwegian Industrial Property Office registers information about licenses that have been granted in a trademark, design or patent right if one of the parties notifies them. It is sufficient that one of the parties wishes such a notification and delivers a notice of license. We have a separate form for this.

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