What is a licensing contract and why is it key in the creative industry?

In the creative industry (film, television, literature, music, software, etc.), intellectual property rights are one of the most valuable assets. The creation of a work automatically generates intellectual property rights in favour of the author(s), who have the power to authorise or prohibit its use by third parties. One of the most commonly used tools to allow such use is licensing.

In this context, a fundamental legal figure appears: the licensing contract.

1. What is a licensing contract?

It is an agreement whereby the holder of intellectual property rights over a work or content authorises a third party to use it without transferring ownership. In other words, the owner retains ownership, but allows another to use the work under the conditions that he or she determines.

This type of contract is a fundamental instrument in the creative industries sector, as it allows content to be monetised while maintaining control over it.

2. What are the characteristics of a licence?

Most licences regulate, among others, the following points:

• Scope of use: Defines what you are allowed to do with the work: reproduce, distribute, publicly communicate, adapt, synchronise, etc. For example: authorising the screening of a film in cinemas or allowing its use on digital platforms.
• Territory: Establishes in which countries or regions the use of the content is authorised.
• Term: Determines the period of time during which the use of the work is permitted.
• Exclusivity: The authorisation can be exclusive, if only the licensee can use the work in that area, or non-exclusive, if the holder has the power to license the same content to other third parties.
• Remuneration: This determines the value or price that the rightholder will receive for licensing the use of the work. For example, a fixed payment, percentage royalties, guaranteed minimums or mixed models can be agreed.

In addition to licences that directly authorise the use of content or works in the creative industries, this type of contract is also used to allow the use of names, logos, distinctive elements or characters protected as trademarks, especially for merchandising and derivative marketing purposes.

3. Why are licences so important?

• They allow the economic exploitation of a work, content or trademark without losing ownership.
• They provide legal certainty to companies, producers and creators.
• They facilitate complex collaborations between multiple actors (authors, platforms, production companies, distributors).
• They help to avoid conflicts and claims for unauthorised use.

Some recent examples of content licensing are:

• The agreement between the Chilean public broadcaster TVN and the owners of "31 Minutos", which allows the series to be played on YouTube.
• The licence granted to Netflix for the international exploitation of the Mexican series "El Chavo del 8", an emblematic case of management and expansion of audiovisual rights.

4. Conclusion

The licensing contract is a strategic tool in the creative industry. It allows creators to protect, control and monetise their works, and companies to access and exploit valuable intellectual assets in a secure and professional manner.

Therefore, the advice of IP lawyers is essential to draft appropriate licences, avoid conflicts and maximise the economic and cultural value of intellectual property in the long term.