The Madrid Agreement allows for international trademark licensing of registered international trademarks. A trademark license is an agreement between the actual owner of a particular trademark and an interested party that is seeking to introduce the trademark in a commercial setting.
Trademark licensing is typically done in order to expand the availability of a trademarked product to other markets, and in the case of international trademark licensing, to other countries or nations. Under the Madrid Agreement, it is not explicitly stated that the recording of a license be mandatory, however, it is granted.
The recording of a trademark license has a similar effect to that of a trademark being protected under common law and state statutes, but not requiring federal registration to recognize the inherent rights and protections of the mark, as is the case in the United States. However, in the occurrence of a trademark licensing contract, it would be in the best interest of both parties to record the agreement, particularly at the international level. By the Madrid Agreement standards, a formal request for the recording of a license must include:
The international trademark registration number of the proposed mark for licensing
Names and addresses of the owner and licensee
A list for all the goods or products that the trademark licensing is to protect or include
The nationality of the licensee
Country or countries the licensee is of legal resident status
The geographic extent or limits that such license is to apply
The status of the license, such as exclusive or non-exclusive
Duration of the license
If royalty dues are part of the agreement, the percentage or amounts to paid to the owner of the trademark
The request for international trademark licensing and recording is to be signed by the appropriate parties, as well as the domestic Office where the request is filed. If the request does not meet all of the instituted requirements by the Madrid Agreement, the International Bureau will notify owner of the trademark, as well as the Office where the request was filed.
If the request is not completed under the required components, the request may be canceled after a period of three months from the date the request was filed, and the International Bureau will notify the parties involved and the domestic Office. If the request is approved, the International Bureau will notify the appropriate parties of the trademark licensing recording approval, and be put on record with the date that the request was received.
The owner of the trademark may also seek to request or declare that recording of a trademark licensing will have no effect. Such request must provide for the a statement listing the reasons for which the license has no effect, as well as what goods or products are affected by such a declaration.
The owner of the trademark has a period of 18 months to issue the declaration of no effect, starting from the date of the trademark licensing request was granted. Any no-effect declaration will be entered into record by the International Bureau into the International Register and notify the involved parties that it has been entered as such.