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Law of contracts

Exclusive license, non-exclusive license, transfer of copyright – differences and similarities

Author Aleksandra Kuranda

When we own copyrights to a work (e.g., we are the authors of a graphic, marketing claim, advertising video, jingle) – we can dispose of them. That is, we can transfer the author’s economic rights to that work (that is, we can “sell” the rights like a car or an apartment) or – we can license the work (that is, we can “rent” the rights). What exactly is the difference between a transfer of copyright and a license (exclusive or non-exclusive), and do we always have to reach for a written contract?

 

Does the granting of a license or the transfer of copyrights always require a written agreement?

The granting of an exclusive license and the transfer of copyright require a written form.

The granting of a non-exclusive license does not require a written agreement – an email, for example, is sufficient.

Regardless of the form of the agreement, it is worth remembering to agree in the agreement at least :

  • parties to the agreement (details of the licensor and licensee),
  • the type of work (it is worth describing it in detail: e.g. graphics, photo, video, marketing claim),
  • the fields of exploitation of the work (i.e., the scope of permitted use: e.g., publishing on the licensee’s social networks, use on the website, reproduction in information brochures, etc.), and the place and time of use.

Provisions for licensing or transfer of copyrights are very often woven into a contract for the creation of a specific work (e.g. advertising, graphics, sculpture).

 

Non-exclusive license – what is it?

If the contract does not address the question of the type of license (exclusive or non-exclusive), the license should automatically be seen as non-exclusive.

What does this mean in practice? Well, the licensor, in the absence of exclusivity, may grant the same license, in the same fields of use (i.e. to the same extent), also to another entity.

For example, licenses for the use of Microsoft Office products are precisely non-exclusive licenses, and anyone who buys the corresponding access can use the tools in the same way.

Daria Milewska

Attorney

Do you have any questions related to this topic?


     

    Exclusive license – what is it?

    The situation is different in the case of an exclusive license. This is because the licensor does not have the option to allow another party (other than the exclusive licensee) to use the work. Exclusive licenses are mainly concluded when one of the parties to the agreement (usually the licensee) intends to obtain exclusive use of the work to a specified extent, place or time.

    In terms of the scope of rights, an exclusive license occupies an intermediate position between a non-exclusive license and a transfer of copyright. This is because it allows only one entity to use the work (exclusivity of the license), but at the same time it does not deprive the licensor of “ownership” of the work (the work is, so to speak, “leased”). This means that after the expiration of the exclusive license, the licensor can grant a license to another entity.

     

    Transfer of author’s economic rights – what does it mean?

    The form that gives the rightsholder (licensee) the widest and most permanent opportunity to use the work is the transfer of author’s economic rights. In this variant, the acquirer of copyrights obtains a complete monopoly over the use of the work (a permanent, final and indefinite monopoly). This situation can be compared to the purchase of a flat or a vehicle – we acquire the purchased thing once and for all.

    Interest in the transfer of copyrights is usually seen in the event that an entity orders individual content from an author, for example, advertising his brand products. For economic reasons, it is reasonable for the brand owner to have full unrestricted and exclusive rights to this advertising.

     

    License or transfer of copyright – which is better?

    Depending on the intended effect, the scope of use of a work can be regulated in different ways. In the case of products (works) available in the same scope to a wide audience, most often it will be the least formalized non-exclusive license, and this will be perfectly sufficient for the licensee.

    On the other hand, when it comes to custom-made and entity-specific works, either an exclusive license or a transfer of copyrights will probably be the best solution. It all depends on whether the ordering party ultimately wants to dispose of the work as an owner (in which case a transfer of copyright should be obtained) or as a “lessee” (in which case an exclusive license will suffice).

    Nonetheless, it is advisable to regulate issues related to allowing third parties to use the work in the form of a written agreement, clearly indicating there the fields of exploitation (that is, how and where the licensee/rights acquirer will be able to use them). In practice, this many times avoids problems of interpretation, which improves the degree of protection of the interests of both the creator and the user of the work.

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