Edited by Jacques de Werra
Chapter 14: Licensing and arbitration
International commercial arbitration often deals with licensing agreements. Approximately one-fifth to one-sixth of all ICC arbitration cases every year cover licensing issues, sometimes in conjunction with other operations, such as franchising, joint venture or R & D contracts, or contracts for work. A few definitions might be useful here: A licensing agreement is a contract whereby the licensor grants to the licensee the right to use an intellectual property right or a confidential technology, or shares with him another factual monopoly that is protected by law, such as the knowledge of trade and commercial secrets, or the likeness of a person (“right of publicity” in American parlance). Patents for invention or for design, copyrights and trade- marks are the most frequent Intellectual Property rights that are licensed in the world today. It would be a mistake to equate “licensing agreements” and “transfer of technology”: although all transfers of technology include a licensing or a sale of technical knowledge or know-how, not every licensing agreement encompasses a transfer of technology. For example, licensing contracts are often executed as part of the settlement of a suit for infringement of an IP right. In such a case, there is usually no accompanying transfer of technology. Copy- right licenses usually include no transfer of technology, save in the software business. Licensing agreements share some common features. They are usually commercial transactions, in which both parties have, or are supposed to have, an appropriate level of expertise in concluding agreements. Thus, the courts or the arbitral tribunals are not called upon to protect a weaker party
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