Trademark Licence Agreement (Ireland)

A Trademark Licence Agreement in Ireland grants permission to use the owner's rights or brand and sets the scope, territory, fees, and duration of that licence, and is governed by the Trade Marks and Designs Act 1992.

The Intellectual Property Office of Ireland (IPOI), operating under the Patents, Trade Marks and Designs Act 1992 (as amended), is the national authority responsible for the registration of trademarks in Ireland. A trademark may be registered under the national Irish system at the IPOI, or at the European Union Intellectual Property Office (EUIPO) as an EU trademark (EUTM) that has effect in all EU member states including Ireland. Where a trademark is registered at the EUIPO, the EU Trade Mark Regulation (EU) 2017/1001 governs its licensing alongside the national provisions of the Trade Marks Act 1996.

Under section 6 of the Trade Marks Act 1996, a trademark is any sign capable of being represented graphically which is capable of distinguishing goods or services of one undertaking from those of other undertakings. Registrable trademarks include words, logos, slogans, shapes, colours, sounds, and combinations thereof. The 1996 Act distinguishes between registered trademarks (which enjoy statutory protection under Part II of the Act) and unregistered marks (which may enjoy some protection under the common law action of passing off, established in Ireland under Reckitt & Colman Products Ltd v Borden Inc [1990] 1 All ER 873 and O'Brien v Walsh [1920] 2 IR 149).

Section 29 of the Trade Marks Act 1996 expressly provides for the licensing of registered trademarks. A licence may be granted for all or any of the goods or services for which the trademark is registered, may be limited as to the manner or place of use, and may be exclusive or non-exclusive. Section 31 of the 1996 Act provides enforcement rights for licensees — an exclusive licensee has the same rights of action as the proprietor to bring infringement proceedings, while a non-exclusive licensee may intervene in proceedings brought by the proprietor to recover their own losses.

The Trade Marks Act 1996 requires the proprietor to exercise quality control over the use of the mark by licensees, in order to maintain the mark's distinctive character and to avoid revocation under section 51 of the Act on grounds that the mark has become deceptive or misleading. A trademark licence that lacks adequate quality control provisions risks being treated as a naked licence — one that does not confer any legitimate connection between the mark and the licensor's quality standards — and may be challenged in revocation proceedings.

The licence agreement should also address competition law compliance, particularly the EU Technology Transfer Block Exemption Regulation (Commission Regulation (EU) No 316/2014) and Articles 101 and 102 of the Treaty on the Functioning of the European Union (TFEU), as well as the Competition Act 2002 (as amended by the Competition (Amendment) Act 2012). Provisions that restrict the licensee's ability to sell into other EU member states, fix prices, or engage in market sharing may infringe EU and Irish competition law and be void and unenforceable.

In practice, Irish solicitors advising on trademark licence agreements will confirm that the agreement clearly identifies the licensed mark (by registration number, representation, and the goods or services covered), the territory, the term, the royalty structure, the quality control obligations, the grounds for termination, and the governing law and dispute resolution mechanism.

An Irish Trademark Licence Agreement is needed whenever the owner of a trademark wishes to authorise another party to use that mark commercially, and both parties want clear, enforceable written terms governing the arrangement.

You need a Trademark Licence Agreement when you are: a brand owner wishing to expand into new markets or distribution channels by appointing licensees who will sell goods or services under your brand; a franchisee or master franchisee entering into an arrangement where the right to use the franchisor's trademark is a central element of the franchise; a manufacturer or retailer wishing to brand its products with a recognised trademark owned by a celebrity, sports body, or media property under a merchandising licence; a software or technology company licensing its brand alongside its technology or software products; a startup that has acquired or developed a trademark and wishes to monetise it by licensing to third parties while retaining ownership; or any business entering into a co-branding, white-label, or brand partnership arrangement.

From a practical standpoint, the absence of a written trademark licence agreement can have serious consequences. Without a written agreement, the parties may dispute the scope of the licence (which goods and services, which territories, for how long), the quality standards the licensee must observe, the royalty rates and payment terms, and the circumstances in which the licence can be terminated. Disputes over unwritten licences are costly to litigate and may result in injunctions preventing the licensee from continuing to use the mark while proceedings are pending.

The requirement for quality control makes a written trademark licence agreement particularly important. Irish trademark law (under section 51 of the Trade Marks Act 1996) and EU trademark law both recognise that a mark may be revoked if its use becomes misleading or deceptive as to quality. A written agreement that sets out the licensor's quality standards, inspection rights, and approval processes provides clear evidence of the quality control exercised by the licensor and protects the mark from revocation.

For businesses operating under an EU trademark (registered at the EUIPO), the licence agreement should address the requirements of the EU Trade Mark Regulation (EU) 2017/1001, including the optional recordal of the licence on the EU Trade Marks Register. Recording the licence at the EUIPO or the IPOI gives constructive notice to third parties and protects the licensee's rights in the event of a subsequent assignment or insolvency of the licensor.

Finally, a trademark licence agreement is needed for Irish Revenue and tax planning purposes whenever royalties are to be paid — particularly where the licensor and licensee are connected parties (such as members of the same corporate group), in which case transfer pricing rules under Part 35A of the Taxes Consolidation Act 1997 require that the royalty rate reflects an arm's-length transaction. A written licence agreement is essential documentation for demonstrating compliance with transfer pricing requirements and for supporting any claim for a deduction for royalty payments in the licensee's tax return.

Under the Companies Act 2014, the Companies Registration Office (CRO) maintains the register of Irish companies. Section 343 of the Companies Act 2014 sets annual confirmation obligations. The Competition and Consumer Protection Commission (CCPC) enforces the Consumer Rights Act 2022. The Central Bank of Ireland regulates financial services under the Central Bank Act 1971. The High Court of Ireland has jurisdiction under Section 212 of the Companies Act 2014.

A thorough Irish Trademark Licence Agreement should contain the following essential provisions to be legally effective and commercially protective.

The parties clause identifies the licensor (the trademark owner) and the licensee by full legal name, registered address, and company registration number (CRO number) where applicable. Where the licence is granted to a group of companies, each entity should be named as a separate licensee, or the licence should expressly extend to subsidiaries and affiliates.

The trademark identification clause precisely identifies the licensed trademark(s) by registration number (IPOI or EUIPO), the representation of the mark, the class(es) of goods or services covered (under the Nice Classification), and whether the licence extends to any pending applications or unregistered marks. Attaching a schedule of all licensed marks reduces the risk of subsequent disputes.

The grant of licence clause specifies whether the licence is exclusive or non-exclusive, the territory (for example, the Republic of Ireland, the island of Ireland, or the European Union), the permitted field of use (the specific goods or services in respect of which the mark may be used), and any restrictions on sublicensing. Where sublicensing is permitted, the licensor should have approval rights over any sublicensee and the sublicensee should be bound by the same quality control obligations.

The term clause states the duration of the licence — whether fixed-term or perpetual — and the conditions for renewal. Most commercial trademark licences are for a fixed initial term (typically three to five years) with renewal options exercisable by the licensee, subject to compliance with the agreement.

The royalties and payment clause sets out the royalty rate (percentage of net sales, per-unit fee, or fixed annual fee), the calculation and reporting obligations (monthly or quarterly sales reports), the payment currency (EUR), payment dates, audit rights allowing the licensor to inspect the licensee's books to verify royalty calculations, and interest on late payments (by reference to the statutory rate under the Courts Act 1981 or the Late Payments Regulations).

The quality control clause is critical under Irish trademark law. It should specify the quality standards, specifications, and approvals that the licensee's goods or services must satisfy, the licensor's right to inspect the licensee's premises and products, the approval process for packaging, marketing materials, and advertising, and the consequences of failing to meet quality standards (including the right to immediate termination).

The intellectual property ownership clause confirms that the licensor retains all ownership of the trademark and all associated goodwill, and that no rights are conferred on the licensee other than the express licence granted. The licensee should acknowledge that all goodwill generated through the licensed use accrues to the licensor.

The termination clause specifies the grounds for termination — expiry of the term, material breach, insolvency, failure to maintain quality standards, non-payment of royalties, or the abandonment or revocation of the licensed mark — and the consequences of termination (including the prompt cessation of use of the mark and the return or destruction of branded materials).

The dispute resolution clause should specify that the agreement is governed by the laws of Ireland, that disputes are subject to the exclusive jurisdiction of the Irish courts, and whether the parties agree to attempt mediation before commencing litigation. The IPOI does not have jurisdiction to resolve contractual disputes between the parties to a trademark licence — such disputes must be resolved through the courts or by arbitration.

Finally, the agreement should include representations and warranties from both parties — from the licensor that it owns the trademark and has the right to grant the licence, and from the licensee that it has the legal capacity to enter into the agreement and will comply with all applicable laws in using the mark. The forms-legal.com Trademark Licence Agreement (Ireland) template covers the mandatory elements under Companies Act 2014.