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Q.  What is a Licence?

A.  It is permission from the owner of a right (the licensor) to someone else (the licensee) to do something which, without that permission, would be an infringement of the right, i.e. the owner of the right would
be entitled to stop someone doing it without permission. Occasionally, a licence may entitle the licensee to extend the permission, i.e. to provide a "sub-licence" to a third party.

Q.  What is an "exclusive" licence?

A.  This is a licence where the owner of the right gives the licensee the right to stop anyone else (including the rights owner itself) from using the right.

Q.  How do I find a Licensee for my new invention?

A.  It's usually very difficult to persuade someone to take a licence unless there is a real commercial prospect for your invention; just making the invention does not demonstrate that, nor does securing a patent, or, even more expensively, securing a portfolio of patents. Usually, the chances of finding someone who will want to take your idea forward are increased directly in proportion to the number of people who know about your idea, so as soon as you have filed for a patent it's good to start telling everyone who might be interested so as to maximise the chance of finding someone who is. Best to do this within the year from your first filing so that if you can find someone, they will pay for the cost of overseas patenting, and you don't have to.

Q.  What should a licence cost?

A.  This will depend entirely on the circumstances. Sometimes the cost of acquiring a license to use is part of the purchase price - for example much computer software comes with a licence when you buy it - the terms
and conditions of the licence are what you have to agree to when you install the software. In other areas, for example for a product with a low manufacturing cost and a very high sale price, such as a phamaceutical drug, the license fee may be a substantial proportion of the selling price, even 40 or 50%. A "merchandising licence" to use a well-known comic strip character as a decorative motif may cost 10 to 12% of the sales price of the goods.