Contractual License vs. Express License

Attribute	Contractual License	Express License
Definition	A license granted through a contract between parties	A license granted explicitly and directly by the licensor
Formality	Requires a formal contract	Can be granted informally or verbally
Duration	May have a specific duration outlined in the contract	May be perpetual or have a specific duration
Scope	Scope of use defined in the contract	Scope of use may be broader or more limited
Enforceability	Enforceable through contract law	Enforceable through the terms of the express license

When it comes to licensing agreements, there are various types that companies can enter into. Two common types are Contractual License and Express License. While both serve the purpose of granting permission to use intellectual property, there are key differences between the two that companies should be aware of before entering into any agreements.

Definition

A Contractual License is a type of license agreement that is negotiated and agreed upon by both parties involved. This type of license typically involves detailed terms and conditions that are outlined in a contract. On the other hand, an Express License is a type of license that is granted by the licensor without the need for negotiation. This type of license is typically granted through a click-through agreement or a shrink-wrap agreement.

Scope of Use

One key difference between Contractual License and Express License is the scope of use that is granted to the licensee. In a Contractual License, the terms and conditions of use are typically negotiated between the parties, allowing for more flexibility in the scope of use. This can include limitations on the geographic area, duration of use, and specific purposes for which the intellectual property can be used. In contrast, an Express License often comes with pre-determined terms and conditions that may limit the scope of use for the licensee.

Duration

Another important difference between Contractual License and Express License is the duration of the license agreement. In a Contractual License, the duration of the agreement is typically negotiated between the parties and can vary depending on the specific terms of the contract. This allows for more flexibility in determining the length of time that the licensee can use the intellectual property. On the other hand, an Express License often comes with a pre-determined duration that is set by the licensor and may not be negotiable.

Termination

When it comes to termination of the license agreement, there are differences between Contractual License and Express License. In a Contractual License, the terms for termination are typically outlined in the contract and can be negotiated between the parties. This allows for more flexibility in determining the circumstances under which the agreement can be terminated. In contrast, an Express License often comes with pre-determined termination clauses that may limit the ability of the licensee to terminate the agreement.

Liability

Liability is another important factor to consider when comparing Contractual License and Express License. In a Contractual License, the parties have the opportunity to negotiate liability clauses that outline the responsibilities of each party in the event of a breach of the agreement. This allows for more flexibility in determining the extent of liability that each party is willing to accept. In an Express License, liability clauses are often pre-determined by the licensor and may not be negotiable, which can limit the ability of the licensee to protect themselves in the event of a breach.

Conclusion

In conclusion, while both Contractual License and Express License serve the purpose of granting permission to use intellectual property, there are key differences between the two that companies should be aware of before entering into any agreements. Contractual License offers more flexibility in terms of negotiation, scope of use, duration, termination, and liability. On the other hand, Express License often comes with pre-determined terms and conditions that may limit the flexibility of the licensee. It is important for companies to carefully consider these differences and choose the type of license agreement that best suits their needs and objectives.