Intellectual Property Rights - Law and Practice · Business Concerns in Commercializing Intellectual Property Rights

Assignment and Licensing of IP Rights: Patents and Copyright

Updated 11 October 2026 · Fact-checked

Assignment transfers ownership of an IP right. A licence only permits use while ownership stays with the owner. For patents, the registered owner may assign or license under section 70, and compulsory licences arise under sections 84, 91 and 92. For copyright, an assignment must be in writing and signed. Answer by stating the rule, applying the facts, then concluding.

Understand Assignment and Licensing of IP Rights

Every IP right is property. Its owner can sell it, share it or keep it. These three choices give you the two core tools of commercialization: assignment and licensing.

Assignment transfers ownership, fully or in part. The assignee steps into the owner's shoes. Licence is permission to do an act that would otherwise infringe. The licensor remains the owner. Think of selling a house versus renting it.

Licences come in several kinds. An exclusive licence lets only the licensee use the right, often even excluding the owner. A non-exclusive licence lets the owner license many people. A sole licence is between the two: the licensee and the owner can use it, but no one else. A voluntary licence is agreed by contract. A compulsory licence is imposed by the Controller under the Patents Act, 1970 without the patentee's consent. Licences may also be limited by territory, period, field of use or sublicensing rights.

In patents, section 70 says the registered grantee or proprietor can assign, grant licences under, or otherwise deal with the patent, subject to co-ownership rules and any rights of others noted in the register. Compulsory licensing is the State's tool to stop a patent being used only as a monopoly. Section 84 allows an application after three years from the grant of the patent on three grounds: public requirements not satisfied, no reasonably affordable price, or the invention not worked in India.

In copyright, the owner can assign the right or license it. Under the Copyright Act, 1957 an assignment must be in writing signed by the assignor or their authorised agent. It should state the work, the rights, the duration, the territory and the royalty. Where duration or territory is not stated, the Act supplies default periods. Learn these defaults from your study material. Royalty is the usual payment, as a percentage of sales, a fixed fee, or both.

Key rules to remember

Assignment vs licence: Assignment = transfer of ownership; Licence = permission to use, ownership retained; Use this one-line contrast to open any comparison answer.
Power of registered owner (Patents Act, s. 70): Registered grantee/proprietor may assign, license or otherwise deal with the patent; Subject to co-ownership provisions and rights of others of which notice is entered in the register. Equities can be enforced as for other movable property.
Compulsory licence timing (s. 84(1)): Application after 3 years from the grant of the patent; Any person interested may apply to the Controller.
Grounds under s. 84(1): (a) public requirements not satisfied; (b) not available at a reasonably affordable price; (c) not worked in India; Any one ground is enough.
Factors for the Controller (s. 84(6)): Nature of invention and time elapsed; applicant's ability to work it; capacity to bear risk and capital; efforts to get a voluntary licence; Efforts to obtain a licence on reasonable terms: a reasonable period ordinarily does not exceed six months. This is not required in national emergency, extreme urgency, public non-commercial use or anti-competitive practice.
Special compulsory licence (s. 92): Central Government notification for national emergency, extreme urgency or public non-commercial use; The Controller then grants a licence on application. Section 87 procedure is not applied in the circumstances in s. 92(3), and the patentee is informed as soon as practicable.
Licence of related patents (s. 91): Holder of another patent may seek a licence if prevented from working it efficiently; The applicant must be willing to grant a licence on reasonable terms for their own invention, and the other invention must have made a substantial contribution to commercial or industrial activities in India. The licence is non-assignable except with the patents.
Revision of terms (s. 88(4)): After 12 months of commercial working, one application for revision if terms are onerous and cause loss; No second application is entertained.
Copyright assignment: In writing, signed by assignor or authorised agent; Mention the work, rights, duration, territory and royalty.

How to solve Assignment and Licensing of IP Rights questions

Use the same sequence for every problem question on assignment or licensing. Keep provision, analysis and conclusion separate.

1Identify the right: patent or copyright. The rules differ.
2Classify the transaction: assignment (ownership moves) or licence (permission only), and its type: exclusive, non-exclusive, sole, voluntary or compulsory.
3State the governing rule in plain words with the section number only where you are sure of it.
4Check formalities: writing and signature for copyright assignment, and for patents the register entry and the owner's registered status.
5Check terms: royalty, territory, duration, field of use and sublicensing.
6Apply the facts. For compulsory licence, test the three-year period, a s. 84(1) ground and the s. 84(6) factors.
7Conclude clearly: valid or not, who holds ownership, and what the party should do (draft, register, apply).

Quickest way: Four-line answer frame

When to use it: Use when time is short or the question asks for a difference, a list of types or a short note.

Define assignment and licence in one line each.
List the types or grounds in bullets.
Add one formality: written signed copyright assignment, or the three-year bar and three grounds under s. 84.
Close with one practical drafting point such as royalty, territory and duration.

Common mistakes in Assignment and Licensing of IP Rights

Treating a licence as a transfer of ownership
Both involve a contract and payment, so they look alike.
Fix: Ask who owns the right after the deal. If the owner is unchanged, it is a licence.
Saying a compulsory licence can be sought at any time after filing
Students mix it with s. 91 or s. 92, where the timing differs.
Fix: For s. 84, state: application after three years from the grant of the patent.
Listing only two grounds under s. 84
Memory slips on the affordability ground.
Fix: Remember the trio: requirements unmet, price not reasonably affordable, not worked in India.
Ignoring the efforts to obtain a voluntary licence
Students focus on the grounds and skip s. 84(6).
Fix: Mention that the Controller considers whether the applicant tried to get a licence on reasonable terms and failed within a reasonable period, which ordinarily does not exceed six months. This is one factor the Controller weighs, not a waiting period the applicant must serve. The factor does not apply in national emergency, extreme urgency, public non-commercial use or anti-competitive practice.
Treating an oral copyright assignment as valid
Students assume commercial deals work on trust.
Fix: Say the assignment must be in writing and signed by the assignor or authorised agent.
Mixing s. 84 and s. 92
Both are compulsory licences.
Fix: s. 84 is an application-based remedy after three years. s. 92 starts with a Central Government notification of emergency, extreme urgency or public non-commercial use.

Worked examples

Example 1

Medico Ltd holds an Indian patent granted four years ago for a diabetes drug. It sells the drug only at a price most patients cannot afford. Pharmex Pvt Ltd, which has a manufacturing unit, applied to Medico for a licence two months ago on reasonable terms and got no reply. Can Pharmex seek a compulsory licence? Advise.

Show the solution

Provision: Under s. 84(1), any person interested may apply to the Controller after three years from the grant of the patent. Grounds: public requirements unmet, no reasonably affordable price, or not worked in India.
Time: four years have passed since the grant, so the three-year condition is met.
Ground: the drug is not available at a reasonably affordable price, which is ground (b).
Section 84(6): the Controller looks at Pharmex's ability to work the invention (it has a unit), its capacity to bear risk and capital, and whether its efforts to obtain a licence on reasonable terms failed within a reasonable period. The Explanation says a reasonable period ordinarily does not exceed six months. The Controller decides what is reasonable on the facts. The Act does not make the applicant wait six months before applying.
Pharmex asked two months ago and got no reply. This is a weaker point for Pharmex than a failed negotiation spread over a longer time, but it is not a statutory bar. The Controller weighs it with the other factors.
Conclusion: Pharmex has a valid ground and meets the three-year condition, so it may apply. It should file with a statement of its interest and the facts, as required by s. 84(3). Prudent advice is to keep negotiating with Medico and to document every request and reply, so the efforts factor supports the application.

Answer: Pharmex qualifies on timing and on the affordability ground, and it may apply now. The two months of unanswered requests is a weaker point on its efforts to get a voluntary licence, but there is no fixed waiting period. The Controller weighs it with the other s. 84(6) factors. Pharmex should keep negotiating and record its efforts.

Example 2

Anita, an author, orally tells Bharat Publications that it may publish her novel for ten years, and later signs nothing. Bharat prints the book. Anita then signs a written agreement with Kiran Books for the same rights. Discuss the position of the parties and the difference between assignment and licence.

Show the solution

Concept: An assignment transfers ownership of copyright. A licence only permits use while the author remains owner.
Formality: Only an assignment must be in writing signed by the assignor or authorised agent. A non-exclusive licence does not need writing. An exclusive licence does need writing.
Bharat's arrangement is oral. It fails as an assignment, so Bharat does not become the owner. But it can still operate as a valid non-exclusive licence to publish for ten years, if the oral permission is proved.
Anita remains the owner throughout. Bharat's printing may therefore be licensed, not unauthorised, so it is not automatically an infringement.
The written agreement with Kiran Books meets the form requirement, provided it states the work, rights, duration, territory and royalty. Whether it is an assignment, an exclusive licence or a non-exclusive licence depends on its wording. That affects Bharat: an exclusive grant of the same rights would conflict with Bharat's permission, and Anita could be liable to Kiran or Bharat on the contracts. A non-exclusive grant to Kiran would sit alongside Bharat's licence.
Conclusion: Bharat cannot claim ownership, but it may hold a valid oral non-exclusive licence. Oral terms are hard to prove, so a drafter should record every licence in writing and state clearly whether it is an assignment, an exclusive licence or a non-exclusive licence.

Answer: Bharat holds no valid assignment because there is no signed writing, but its oral permission may operate as a valid non-exclusive licence, so its printing may be licensed. Anita stays the owner. Kiran's position, and its effect on Bharat, depends on whether Kiran's rights are exclusive. The key difference: assignment moves ownership, while a licence permits use and ownership stays with the owner.

Exam tips

Open every comparison question with the one-line contrast between assignment and licence, then add a short bullet table in words, not a drawn table.
Learn the s. 84 trio of grounds and the three-year rule cold. Examiners often test them in a short fact pattern.
In case-based questions, always check the formality first: written signed assignment for copyright, and registered owner status for patents.
End practical answers with drafting points: royalty, territory, duration, field of use, sublicensing and termination.
Do not quote section numbers you are unsure of. Describe the rule in plain words instead.

Practice questions from Business Concerns in Commercializing Intellectual Property Rights

Assignment and Licensing of IP Rights: frequently asked questions

What is the difference between assignment and licence of copyright?

An assignment transfers ownership of the copyright, wholly or partly, and must be in writing signed by the assignor or authorised agent. A licence only permits use of the work while the author or owner stays the owner. The terms of royalty, duration and territory should be stated in both.

When can a compulsory licence be sought under section 84 of the Patents Act, 1970?

Any person interested may apply to the Controller after three years from the grant of the patent. The grounds are that public requirements are not met, the invention is not available at a reasonably affordable price, or it is not worked in India. The Controller considers factors such as the applicant's ability and efforts to get a voluntary licence.

What is the difference between section 84 and section 92 licences?

Section 84 applies on an application by any person interested, after three years from the grant, on listed grounds. Section 92 applies when the Central Government notifies national emergency, extreme urgency or public non-commercial use, after which the Controller grants a licence on application. In the s. 92(3) circumstances, the section 87 procedure is not applied.

Who can license a patent?

The person registered as grantee or proprietor can assign, license or otherwise deal with the patent. This is subject to co-ownership provisions and any rights of others of which notice is entered in the register.

What types of licences should I know for the exam?

Know exclusive, sole, non-exclusive, voluntary and compulsory licences. Be ready to explain each in a line and to say how territory, duration and sublicensing limit a licence.