Copyright license

In the area of literary and artistic property, the license agreement for copyright is an agreement by which the copyright owner (the licensor) authorizes the exploitation of all or part of its economic rights on the intellectual work to a third party (the licensee), usually in exchange for a royalty, often proportional to the result (turnover, profit) of the exploitation.

First of all, it is important to specify that a copyright license can only concern the economic rights (reproduction right, representation right, resale right), but that it can in no case provide for the license of moral rights which are inalienable.

In general, France is a very protective country for authors and has specific obligations regarding contracts providing for the transfer of copyright.

The legal framework of the license agreement is set out in Book I of the Intellectual Property Code.

Article L.131-2 of the Intellectual Property Code requires a written document: “Contracts by which copyrights are transmitted must be established in writing.

Moreover, article L.131-3 of the Intellectual Property Code specifies that: ” The transfer of the author’s rights shall be subject to the condition that each of the assigned rights is mentioned separately in the act of transfer and that the field of exploitation of the assigned rights is delimited as to its extent and destination, as to the place and as to the duration.”

Thus, in France, the law provides that any transfer of copyright, even partial and not definitive within the framework of a license, must be formalized by a contract whose content must precisely detail :

• The work concerned

The work on which the rights are granted must be precisely identified.

• Transferred rights

The contract must detail precisely each of the rights transmitted to the licensee (for example: rights to reproduce, disclose to the public, adapt, or translate the work…) and also define the modes of exploitation and their destinations (conditions of use and diffusion, field of intervention of the licensee, possible prior authorizations of the holder of the rights).

• The duration

The license may be for a fixed term or an indefinite term.

It is important to specify this point in the contract, as well as the conditions for renewal or early termination of the license.

• Geographic scope

The license must specify the place for which the exploitation rights are granted.

• Whether the license is exclusive or not

The license may be granted on an exclusive basis (the licensor to license to third parties) or on a non-exclusive basis (the licensor reserves the right to grant further licenses to third parties).

• Financial terms of the license

Article L.131-4 of the Intellectual Property Code provides that :

“ The transfer by the author of his rights on his work can be total or partial. It must include the author’s proportional participation in the revenue from the sale or exploitation.

However, the following paragraphs of the same article provide for the possibility of setting a flat fee in the following cases:

“(1) The basis for calculating the proportionate share cannot be practically determined ;

2° The means to control the application of participation are lacking;

3° The costs of calculation and control operations would be out of proportion to the results to be achieved;

4° The nature or conditions of the exploitation make it impossible to apply the rule of proportional remuneration, either because the author’s contribution does not constitute one of the essential elements of the intellectual creation of the work, or because the use of the work is only incidental to the object exploited;

5° In case of transfer of rights to software ;

6° In the other cases provided for in this code.

Also lawful is the conversion between the parties, at the request of the author, of the rights arising from existing contracts into lump-sum annuities for terms to be determined between the parties.”

In view of the above, copyright owners are strongly advised to be assisted by experts in the field(lawyers or CPI) in the negotiation, drafting and execution of license agreements on these rights.

Point on the possibility for the author to terminate the contract in the absence of exploitation of the work

Article L.131-5-2 of the Intellectual Property Code provides that: “When the author has transmitted all or part of his rights on an exclusive basis, he may, in the absence of any exploitation of his work, automatically terminate the transmission of all or part of these rights “.

The Bouchara firm assists you in particular in :

• The management of your works protected by copyright (reproduction rights, representation rights etc…);
• Negotiations between licensor and licensee;
• The drafting of the license agreement for your works;
• The follow-up of the execution of your brand licensing contracts;
• Litigation proceedings relating to the validity and performance of the license agreement;
• Filing your intellectual property titles before the Offices and following the registration procedure;
• Legal protection and defense of your intellectual property rights (detection of fraudulent copies of your works, infringement action, unfair competition action…).