When such licensing agreements are concluded between a mainland Chinese and a foreign international party, a joint venture is often created to use the intellectual property rights granted in accordance with the agreement. Hong Kong law is one of the most popular legal options for such agreements. Parties often choose Hong Kong law as the applicable law to choose a forum that is neutral enough for both parties and to use Hong Kong`s serious judicial system. If the taker does not respect the agreement (for example. B by not paying the royalties due), the licensee may initiate legal proceedings against the taker for loss and injury suffered, as well as interest. The loss/prejudice requirement can be invoked either by the competent court or by an arbitral tribunal, depending on the dispute resolution mechanisms agreed in the agreement. Licensing agreements often provide that a party violates the terms of the contract, the innocent party will ask the aggrieved party in writing to correct the infringement within a specified period of time. As a general rule, if the infringement is not repaired, the innocent party may unilaterally terminate the licence and take appropriate legal steps to recover the losses or damages suffered. Otherwise, it may be difficult for the licensor to enforce the agreement against the breached licensee. In the event of a breach, the licensee should take immediate action: to maximize its own protection and to prepare for a possible claim against the licensee, which may include: for example, the licensee may apply to the Hong Kong courts for an injunction to immediately prevent the taker from committing the current infringement (i.e. the violation of the donor`s intellectual property rights outside the licence or the violation of the non-competition clause) and/or the freezing of the taker`s assets as a measure.
This article describes the most common points of contention regarding IP licensing agreements and legal actions available in the event of infringement. Careful planning and detailed development provide the best protection for parties to an IP licensing agreement. In the event of an infringement, the above action should be considered as soon as possible in order to prohibit any further wrongdoing and maximize the recovery of losses incurred. The brand extension license is another special licensing relationship. It occurs when a brand owner with a brand recognized in the market for his own products grants a license to use his trademark to a licensee in relation to other products. In this way, the non-competitive products of the taker use the existing brand and the recognition of the licensee in the market. If questions arise under the licensing agreement, the licensee will often refuse to provide his books and documents for the licensee`s inspection – to prevent the donor from receiving evidence of any claims. If more serious offences are committed, communication between the parties may even completely fail. Franchising is such a special licensing relationship. In the context of a franchise agreement, a franchisor usually concedes a combination of: non-payment of unpaid royalties is one of the most common causes of litigation.