How to Licence a Patent

To licence a patent, also more properly known as, to ‘license’ a patent, is a way how to convey your rights to a patent. A license is like a lease. Instead of selling the rights to a patent, you may lease, or licence, those rights to a company who may in turn manufacture, use and/or market your patent to the consumer.

The terms of a licence to a patent are up to the parties to determine, and not controlled by the government except to the extent that you should conform with the laws that regulate the conduct of business.

Generally when you licence a patent you receive a royalty payment, normally paid a commission on sales of products or technology resulting from your patent, and paid quarterly, annually, and in some cases, monthly.

Royalty payments may range for 3% to 5% of the net sales of the company to whom you licence a patent, however these rates can range from below 2% to above 10%, depending on the project and circumstance. When you licence a patent, you may also receive an upfront payment or advance on royalty, both of which are lump sum payments.

How to licence a patent?

To learn more about how to licence a patent, Contact Docie Invention and Patent Marketing Service and receive a free evaluation of a patent you wish to licence. Also read The Inventor’s Bible: How to Market and License Your Brilliant Ideas.