What types of contracts does AMLEGALS handle?

AMLEGALS provides comprehensive contract advisory across 43+ contract types including Technology contracts (SaaS, AI/ML, Cloud Services), Data Privacy agreements (DPAs, DPDPA compliance), Commercial contracts (MSAs, Supply, Distribution), IP & Licensing, Employment agreements, and International Trade contracts.

What is the TCL Framework for contracts?

The TCL Framework is AMLEGALS proprietary approach that examines every contract through three lenses: Technical (understanding the operational realities), Commercial (aligning business objectives), and Legal (ensuring compliance and risk mitigation). This integrated approach ensures contracts that work in practice, not just on paper.

Does AMLEGALS handle DPDPA-compliant contracts?

Yes, AMLEGALS specializes in DPDPA-compliant contracts including Data Processing Agreements, Cross-Border Transfer Mechanisms, Data Sharing Agreements, and Consent Management frameworks. Our Vibe Data Privacy™ framework ensures comprehensive compliance with the Digital Personal Data Protection Act, 2023.

Can AMLEGALS help with AI and technology contracts?

Yes, AMLEGALS has dedicated expertise in AI/ML Contracts, AI Governance agreements, AI Training Data Licensing, SaaS Agreements, Cloud Services agreements, and System Integration contracts. We address emerging issues like algorithmic accountability, model ownership, and AI liability allocation.

How should royalties be structured in technology licenses?

Royalty structures should align with business economics. Common approaches include: running royalties as percentage of sales, per-unit royalties for clearly defined products, minimum annual payments ensuring base return, milestone payments tied to development stages, and combinations thereof. Royalty bases should be objectively measurable with clear audit rights.

What is a field-of-use restriction?

Field-of-use restrictions limit the licensed rights to specific applications, products, or markets. A licensee might receive rights for automotive applications but not aerospace. These restrictions allow licensors to license the same technology multiple times and ensure appropriate value capture. They must be clearly defined to avoid disputes.

How should improvements be handled?

Improvement provisions range from: licensee owns all improvements freely, to non-exclusive license-back to licensor, to assignment to licensor. Competition law scrutinises provisions requiring assignment of improvements or exclusive grant-backs. Balanced approaches provide non-exclusive, royalty-free licenses to improvements while preserving licensee incentive to invest in development.

What happens to licensed technology at termination?

Termination provisions should address: cessation of rights to use the technology, disposition of products in development, sell-off period for completed inventory, return or destruction of confidential information, and continuing confidentiality obligations. Practical considerations include embedded systems, customer commitments, and successor products.

Technology Licensing Agreements | Patent License Contracts

Overview

Technology licensing transforms intellectual property from a static asset into a productive relationship. Through licensing, technology owners can generate returns from their innovations without the capital requirements and market risks of direct exploitation. Licensees can access technologies that would take years and enormous resources to develop independently. The license agreement structures this exchange, defining what is licensed, how it may be used, and what compensation flows back to the licensor.

The complexity of technology licensing arises from the nature of what is being licensed. A patent grants specific rights for a limited term in specific jurisdictions. Trade secrets have no registration, no defined scope, and potentially unlimited duration. Know-how may be difficult to specify completely at contract execution. The license must define its subject matter with precision while accommodating the reality that technology is not always neatly bounded.

Technology licensing also creates ongoing relationships with evolving dynamics. As the licensee works with the technology, it may develop improvements. As markets develop, the original field-of-use restrictions may become constraining. As the technology matures, its value and appropriate royalty rates may change. The license agreement must anticipate and provide mechanisms for these evolutions.

Key Considerations

1

Licensed Technology

Precise definition of what is licensed - specific patents, patent families, trade secrets, know-how, and documentation.

2

Grant Scope

Exclusivity level, field-of-use restrictions, territorial limitations, and sublicensing rights.

3

Royalty Structure

Upfront fees, running royalties, minimum payments, and adjustment mechanisms over the license term.

4

Technical Transfer

Documentation, training, technical support obligations, and ongoing assistance requirements.

5

Improvement Provisions

Ownership and licensing of improvements developed by either party during the license term.

6

Enforcement and Defense

Rights and obligations regarding enforcement against infringers and defense against validity challenges.

Applying the TCL Framework

Technical

Understanding the technology's actual capabilities and limitations
Assessing the completeness of technology documentation
Evaluating what technical support will be required
Understanding how improvements typically arise in this technology
Reviewing freedom-to-operate for the intended use

Commercial

Valuing the technology against alternatives
Structuring royalties to align with business model
Negotiating exclusivity against royalty levels
Addressing make-versus-buy economics
Managing competitive restrictions

Legal

Defining the licensed IP with precision
Structuring grant of rights appropriate to technology type
Addressing improvement ownership in compliance with competition law
Creating enforcement mechanisms that work
Drafting termination provisions appropriate to technology relationships

“

"A technology license is not just a grant of rights - it is a relationship through which technology is transferred and value is created. The agreement must address not just the legal grant, but the practical reality of making the technology work in the licensee's hands."

AM

Anandaday Misshra

Founder & Managing Partner

Common Pitfalls

Undefined Technology

Vague descriptions of licensed technology that create disputes about scope and lead to royalty arguments.

Improvement Traps

Grant-back provisions that require assignment of improvements to the licensor, potentially violating competition law and disincentivising licensee investment.

Royalty Disputes

Royalty provisions that sound clear but become ambiguous when applied to actual products and sales structures.

Support Expectations

Misaligned expectations about ongoing technical support leading to relationship breakdown.

Termination Chaos

Inadequate provisions for what happens to products in development or inventory at termination.

Technology Transfer Regulation

Technology licensing in India navigates multiple regulatory frameworks. The Competition Act scrutinises certain license provisions including exclusive grant-backs, tying arrangements, and restrictions on challenging IP validity. Foreign technology licenses may require regulatory filing or approval in certain sectors. Transfer pricing rules affect royalty rates in related-party licenses. Export control regulations may restrict licensing of certain technologies. The Patents Act defines the scope of patent rights and compulsory licensing provisions that may affect license stability.

Practical Guidance

Conduct thorough technical due diligence before committing to license arrangements.
Define the licensed technology through specific patent numbers, attached documentation, and clear descriptions.
Structure royalties around metrics that can be objectively measured and verified.
Build in technical support and training that transfers actual operational capability.
Address improvements with provisions that encourage innovation without raising competition concerns.
Plan for technology evolution and relationship changes over what may be a long license term.

Frequently Asked Questions

Related Contract Types

AI & Machine Learning Contracts

Technology & Digital

Agreements governing algorithmic systems, training data rights, model ownership, and liability allocation

Software Licensing Agreements

Intellectual Property

End-user, enterprise, and OEM licenses with deployment and modification rights

Trademark Licensing Agreements

Intellectual Property

Brand licensing with quality control and usage guidelines

Research Collaboration Agreements

Intellectual Property

Joint development agreements with background and foreground IP allocation

Related Practice Areas

Intellectual Property Technology & IT Competition Law

Technology Licensing Agreements

Overview

Key Considerations

Licensed Technology

Grant Scope

Royalty Structure

Technical Transfer

Improvement Provisions

Enforcement and Defense

Applying the TCL Framework

Technical

Commercial

Legal

Common Pitfalls

Undefined Technology

Improvement Traps

Royalty Disputes

Support Expectations

Termination Chaos

Technology Transfer Regulation

Practical Guidance

Frequently Asked Questions

Related Contract Types

AI & Machine Learning Contracts

Software Licensing Agreements

Trademark Licensing Agreements

Research Collaboration Agreements

Related Practice Areas

Need Assistance with Tech Licensing?