Sample agreement for the provision of royalty services. Royalties under licensing agreements. Improvements and enhancements

Quite simple: royalties are that part of the proceeds from the sale of a product that the author receives. Despite the simplicity of the formulation, the topic is quite extensive and, in connection with this, taxation and accounting of such transactions has a number of features. Let's try to deal with some of them.

Scope of application and some legal issues

The concept of royalty can be attributed to several legal areas. Thus, it is used as one of the forms of payment under a contract widely in the franchising sphere and denotes copyright and license payments for the commercial use of something belonging to another person (patent, work of art, etc.).

And finally, royalties in economics and land law (a term used in world practice) are rent payments for the right to develop natural resources paid by an entrepreneur to the owner of land or subsoil.

The legal relations of the parties regarding royalties related to franchising activities are regulated by Chapter 54 of the Civil Code of the Russian Federation (the basis of the relationship: a commercial concession agreement). In accordance with paragraph 4 of Article 1027 of the Civil Code of the Russian Federation, all rules of the Civil Code of the Russian Federation on a license agreement are applied to a commercial agreement. The only difference between a commercial concession agreement and a license agreement from a legal point of view is the object of the agreement. In a commercial concession agreement, an object is a set of exclusive rights, while in a license agreement it is the right to use an intellectual property object.

Based on clause 2 of Art. 1028 of the Civil Code of the Russian Federation, a commercial concession agreement is subject to the federal authority for intellectual property (Rospatent). According to the general rule of Art. 1031 of the Civil Code of the Russian Federation (which can be amended by agreement), a commercial concession agreement must be registered by the copyright holder (franchisor). If the registration requirement is not met, the contract is considered void (according to Article 1031, paragraph 2 of Article 1028, paragraphs 3,6 of Article 1232, paragraph 1 of Article 1490 of the Civil Code of the Russian Federation).

Relations between individuals (authors) and persons receiving exclusive rights to works are regulated by Chapter 70 of the Civil Code of the Russian Federation. It determines that the relationship must be confirmed in writing in the form of a certain type of agreement. These are types of contracts such as:

agreement on the alienation of the exclusive right to a work and the right to use the work under a license (Article 1285 of the Civil Code of the Russian Federation);
license agreement granting the right to use the work (Article 1286 of the Civil Code of the Russian Federation);
copyright agreement (Article 1288 of the Civil Code of the Russian Federation).

As for royalties in the economy, from the point of view of world practice, the mineral extraction tax introduced in the Russian Federation in 2002 actually currently performs the functions of a royalty (payment to the owner of resources for the right to develop reserves).

It is necessary to dwell separately on agreements with counterparties, because a question arises about the applicable law (Russian or foreign). According to paragraph Art. 1211 of the Civil Code of the Russian Federation, by default, the law of the country with which the contract is most closely related is applied to the contract. The relations of the parties under the license agreement are governed by the law of the state where the licensor is located. At the same time Art. 1210 of the Civil Code of the Russian Federation allows the parties to an agreement to choose the law that is subject to application to their rights and obligations under this agreement. When applying Russian law, relations automatically fall under the regulation of Part 4 of the Civil Code of the Russian Federation.

Tax aspects

Income tax

Expenses in the form of royalties are recognized in the period to which it relates, on the date in accordance with the conditions or on the date of presentation to the user of documents serving as the basis for making calculations, or on the last day of the reporting (tax) period (clause 3, clause 7, art. 272 of the Tax Code of the Russian Federation).

For profit tax purposes, income from the granting of rights to the results of intellectual activity for use, in accordance with clause 5 of Art. 250 of the Tax Code of the Russian Federation, relate to non-operating income if they are not determined by the taxpayer in the manner specified in Art. 249 of the Tax Code of the Russian Federation, as income from the sale of property rights. Thus, if for the copyright holder this type of activity is one of the main types of activity, then income is recognized in accordance with Art. 249 of the Tax Code of the Russian Federation, and if not, then in accordance with Art. 250 Tax Code of the Russian Federation.

In clause 3, clause 4 of Art. 271 of the Tax Code of the Russian Federation determines that for non-operating income in the form of royalties, the date of receipt of income is recognized as the date of settlements in accordance with the terms of concluded agreements, the date of presentation to the taxpayer of documents serving as the basis for making settlements, or the last day of the reporting (tax) period.

Important:

International aspect

One of the most common tax planning schemes is the transfer of intellectual property rights to an offshore company for the purpose of accumulating royalties in a tax-free jurisdiction.

UNCTAD estimates the global offshore industry to be worth US$12 trillion (http://www.unctad.org). Russian organizations cannot do without the use of offshore business. The use of offshore jurisdictions by Russian organizations affects not only their internal interests, but also the interests of Russia as a whole. Evasion reduces the public sector of the country's economy, and companies that evade paying taxes through such schemes may find themselves in a worse position than law-abiding taxpayers.

Accounting

In organizations whose subject of activity is the provision for a fee of rights arising from patents for inventions, industrial designs and other types of intellectual property, revenue is considered to be receipts the receipt of which is associated with this activity. Thus, remuneration should be included in income from ordinary activities in the reporting period in which they were accrued under the terms of the agreement (clauses 12 and 15 of PBU 9/99).

The organization's expenses for paying royalties related to its core activities are recognized as expenses for ordinary activities in accordance with clause 5 of PBU 10/99, approved by Order No. 33n dated 05/06/1999.

Example

In October 2011, Alpha LLC transferred to the Company the right to use a set of exclusive rights to intellectual property (this service is the main activity). Monthly payments are set in a fixed amount in euros and are subject to receipt on the terms of 100% prepayment in rubles at the official rate on the day of payment. The monthly payment under the contract is set at 118 euros (including VAT) and is due no later than the 15th day of the month preceding the billing month. The euro exchange rate set by the Bank of Russia as of October 15, 2011 is 41.6638 rubles/euro.

Dt 51 “Settlement accounts” Kt 76-5 “Settlements with other debtors and creditors”

RUB 4,916 (118 euros* 41, 6638) - Advance payment received from
user for November

D-t 76-VAT K-t 68-2 “Calculations for VAT” 750 rub. (RUB 4,916 x 18/118) - VAT is calculated on the prepayment received

D-t 76-5 K-t 90.1 “Sales” 4,916 rub. (118 euros* 41, 6638) - Income for
november

Dt 90-3 “Value added tax” Kt 68.2 750 rub. (RUB 4,916 x 18/118) - VAT calculated on income

D-t 68-2 K-t 76-VAT 750 rub. - Accepted for deduction of VAT calculated from the prepayment amount for November

Publication

In practice, companies that use or provide for use any types of intellectual property, such as patents, computer programs or trademarks, face royalties. The use of the exclusive right occurs within the framework of a license agreement for a fee - royalties, periodic fixed or percentage payments to the copyright holder.

The parties to the license agreement are the licensor and the licensee (clause 1 of article 1233 of the Civil Code of the Russian Federation).

licensor - the one who grants the other party (licensee) the right to use intellectual property (non-exclusive right) (Articles 1235, 1243 of the Civil Code of the Russian Federation);
licensee - pays for and accepts intellectual property for use. In other words, it receives non-exclusive rights to it within the framework of the concluded agreement (Article 1235 of the Civil Code of the Russian Federation).

7 Required Components of a License Agreement

Licensor and licensee data.
Subject of the agreement: description of the transferred intellectual property object and a list of actions that the licensee has the right to perform with it.
Type of license agreement (exclusive or non-exclusive license).
The territory in which the transferred right can be used. If the territory is not specified, then it is understood as the Russian Federation.
The period for which the contract is concluded.
Conditions, payment procedure and amount of remuneration of the licensor or gratuitousness of the transaction.
Conditions, terms and procedure for the licensee to report on the use of intellectual property. If such a report is not required, this must be mentioned in the contract;

Accounting with the licensor

Z3 Accounting. The intangible asset transferred under the license agreement continues to be listed on the licensor’s balance sheet (clause 38 of PBU 14/2007). It is accounted for in a separate subaccount. For example, to account 04 “Intangible assets” a subaccount “Intangible assets transferred for use under a license agreement” is opened. In this case, the following wiring is done:

Dt 04 subaccount “Intangible assets transferred for use under a license agreement” Kt 04 subaccount “Intangible assets without encumbrance” - non-exclusive rights to an intangible asset have been transferred.

Depreciation

Having transferred an intangible asset for use, depreciation continues to be charged on it, and it is calculated in the general manner (clause 38 of PBU 14/2007).

If the transfer of non-exclusive rights to intellectual property is the subject of the company’s activities, then the amounts of accrued depreciation are taken into account as expenses for ordinary activities (clause 5 of PBU 10/99). The wiring will look like this:

Dt 20 (44...) Kt 05 subaccount “Depreciation of intangible assets transferred for use” - reflects the amount of accrued depreciation on an intangible asset transferred for use.

When the transfer of non-exclusive rights to intellectual property is not a separate type of activity of the organization, then depreciation amounts must be taken into account as part of other expenses (clause 11 of PBU 10/99, approved by order of the Ministry of Finance of Russia dated May 6, 1999 No. 33n). The operation is reflected with the following entry:
Dt 91-2 Kt 05 subaccount “Depreciation of intangible assets transferred for use” - reflects the amount of accrued depreciation on an intangible asset transferred for use.
Revenue

The transfer of intellectual property for use usually entails the receipt of income by the licensor. If leasing intellectual property is one of the company’s activities, then royalties are recognized as revenue (clause 5 of PBU 9/99). This is reflected in accounting as follows:

Dt 62 (76) Kt 90-1 – royalties accrued.

If the transfer for use is not the subject of the company’s activities, then the income received must be included in other income. The accounting entry will be like this:

Dt 62 (76) Kt 91-1 – royalties accrued.

Example 1

Ferma LLC acquired the right to use this selection achievement from Zootekhnika for one year. According to the agreement, “Farm” undertakes to pay monthly remuneration to “Zootechnika” in the amount of 3,540 rubles. (including VAT - 540 rubles).

Since the subject of activity of Zootekhnika LLC is the provision of selection achievements belonging to it for temporary use, the income from the transaction is recognized as revenue. Thus, when transferring an object of intellectual property, the Zootekhnika accountant made the following entry:

Dt 04 subaccount “Intangible assets transferred for use”” Kt 04 subaccount “Intangible assets located in the organization” - 150,000 rubles.

The accountant also continues to calculate depreciation, making a monthly entry:

Dt 20 Kt 05 “Amortization of intangible assets transferred for use” – 2500 rub.

The accountant then writes off these expenses to the cost of sales:

Dt 90-2 Kt 20 – 2500 rub.

The accountant considers license fees as revenue:

Dt 62 “Settlements with buyers and customers” Kt 90-1 – 3540 rub.

VAT is charged on the amount of revenue:

Dt 90-3 Kt 68 – 540 rub.

When payments are received from Ferma LLC, the accountant makes an entry:

Dt 51 Kt 62 – 3540 rub.

Upon termination of the contract, the accountant will make the following entry:

Dt 04 subaccount “Intangible assets located in the organization” Kt 04 subaccount “Intangible assets transferred for use” - 150,000 rubles.

Taxation

Income from the transfer of non-exclusive rights under a license agreement is non-sales income if it does not relate to sales income (clause 5 of Article 250 of the Tax Code of the Russian Federation). In practice this means the following. If the licensor enters into licensing agreements on a systematic basis, then income should be recognized as part of sales revenue. This conclusion can be made based on an analysis of the provisions of tax and civil legislation (subclause 1, clause 1, article 265 of the Tax Code of the Russian Federation, article 606, clause 1, article 1235 of the Civil Code of the Russian Federation).

Just an FYI

Systematicity means two or more times during a calendar year (clause 3 of Article 120 of the Tax Code of the Russian Federation).

Depending on the type of intellectual property transferred, the licensor's remuneration may be subject to VAT (subclause 1, clause 1, article 146 of the Tax Code of the Russian Federation). The fact is that the transfer of certain types of intangible assets for use is exempt from VAT. Such assets include (clause 26 of article 149 of the Tax Code of the Russian Federation):

inventions;
utility models;
industrial designs;
computer programs;
Database;
topologies of integrated circuits;
know-how.

However, the mere fact that an intangible asset is on the preferential list for VAT exemption is not enough. You will also need a correctly executed license agreement between the licensor and the licensee (letters from the Ministry of Finance of Russia dated May 19, 2009 No. 03-07-07/45, dated January 12, 2009 No. 03-07-05/01).

Just keep in mind

Even if the licensor’s income is not subject to VAT, the licensor is obliged to issue an invoice to the licensee for the amount of license payments (clause 3 of Article 169 of the Tax Code of the Russian Federation). You need to make a note in it “Without tax (VAT)” (clause 5 of Article 168 of the Tax Code of the Russian Federation).

Accounting with the licensee

Accounting

Intangible assets received for use are taken into account off the balance sheet (clause 39 of PBU 14/2007). An account for this is not provided for in the standard chart of accounts; the company enters it independently. For example, account 012 “Intangible assets obtained on the basis of a license agreement.” We add that the received object is accounted for as a debit to account 012 in the amount of license payments for the entire term of the agreement (clause 39 of PBU 14/2007). This is reflected in accounting as follows:

Expenses for payment of royalties by the licensee are related to expenses for ordinary activities (clause 5 of PBU 10/99). They are included in the expenses of the current period and are reflected in accounting as follows:

Dt (20, 44...) Kt 60 (76) – periodic license payments are taken into account.

Example 2

As initial data, let’s take the condition of Example 1 and consider the accounting at Ferma LLC.

When receiving an intangible asset for use, the accountant will make the following entry:

Dt 012 “Intangible assets obtained on the basis of a license agreement” – RUB 36,000. (3000 rubles × 12 months).

The accountant will record the following monthly expenses for license fees:

Dt 26 “General expenses” Kt 76 – 3000 rub.

It will also take into account “input” VAT:

Dt 19 Kt 76 – 540 rub.

Royalty payments will be accounted for as follows:

Dt 76 Kt 51 – 3540 rub.

Upon expiration of the contract, the accountant will write off the value of the intangible asset received for use:

Kt 012 “Intangible assets obtained on the basis of a license agreement” – 36,000 rubles.

Taxation

License payments can be taken into account when calculating income tax as part of other expenses associated with production and (or) sales (subclauses 26, 37 and 49, clause 1, article 264 of the Tax Code of the Russian Federation). The main condition is compliance with Art. 252 of the Tax Code of the Russian Federation on documentary evidence and economic justification of costs.

The licensee can deduct “input” VAT on license payments at a time. Naturally, if the conditions mandatory for receiving a deduction are met (clause 1 of Article 172 of the Tax Code of the Russian Federation).

If the licensor is an individual, personal income tax must be withheld from the royalty amount. The duties of a tax agent are performed by the licensee (Article 209, paragraph 1 of Article 210 of the Tax Code of the Russian Federation). An exception is payments to the heirs of the author of an invention, utility model and industrial design. Such persons independently pay personal income tax (subclause 6, clause 1, article 228 of the Tax Code of the Russian Federation).

If expenses cannot be documented, you need to use cost standards. They are set as a percentage of income received separately for various types of intellectual activity. The range of standards ranges from 20 (scientific developments) to 40 percent (creation of sculptural works). A complete list of types of intellectual activity and the standards applied to them is in Art. 221 Tax Code of the Russian Federation.

Often, organizations with foreign participation take the name from their foreign “mother”, because it is much easier to start an activity with a “promoted” brand. However, in this case, a Russian company becomes obligated to pay so-called royalties for the use of a trade name.

Royalty (eng. royalty - royal privileges) - periodic payment for the right to use a license for goods, inventions, patents, innovations, publishing books, renting films.

Based on business customs, royalties are paid monthly under the relevant license agreements on the right to use, for example, a trade name.

Within the framework of civil law relations, royalties will be remuneration under a license agreement #M12293 0 902019731 0 0 0 0 0 0 0 249627279(Clause 5 of Article 1235 of the Civil Code of the Russian Federation)#S. Russian legislation does not establish restrictions on the maximum amount of royalties paid under licensing agreements.

Therefore, the parties, based on free legal will, have the right to establish any reasonable value of such an agreement. These license agreements are subject to state registration, without which they are declared invalid ( #M12293 1 902019731 0 0 0 0 0 0 0 249365133 pp. 2, 3, 6 tbsp. 1232#S #M12293 2 902019731 0 0 0 0 0 0 0 249627279 para. 2 p. 2 art. 1235#S #M12293 3 902019731 0 0 0 0 0 0 0 346424057 clause 1 art. 1490 Civil Code of the Russian Federation #S )*1.

*1 Most often, when transferring rights to trademarks, a subtype of licensing agreement is concluded - a commercial concession agreement ( #M12293 4 9027703 0 0 0 0 0 0 0 395903771 Ch. 54 Civil Code of the Russian Federation #S ).

Income tax

For profit tax purposes, monthly payments (royalties) for the use of the licensor's invention (name) in the production of products are recognized as other expenses associated with production ( #M12293 0 901765862 0 0 0 0 0 0 0 346227452 subp. 37 clause 1 art. 264#S #M12293 1 901765862 0 0 0 0 0 0 0 345637623 subp. 8 paragraph 2 art. 256 of the Tax Code of the Russian Federation#S), and are taken into account when forming the tax base for income tax.

Such expenses based on #M12293 2 901765862 0 0 0 0 0 0 0 395445023 clause 1 art. 318 of the Tax Code of the Russian Federation #S are indirect and fully relate to the expenses of the current reporting (tax) period ( #M12293 3 901765862 0 0 0 0 0 0 0 395445023 clause 2 art. 318 Tax Code of the Russian Federation #S).

In accordance with #M12293 4 901765862 0 0 0 0 0 0 0 395117342 subp. 4 paragraphs 1 art. 309 of the Tax Code of the Russian Federation #S, the income of a foreign organization (which is not related to its business activities in the Russian Federation, carried out through permanent representative offices), received from sources in Russia and subject to income tax withheld by the organization - the source of payment of income, includes income from use in the Russian Federation rights to intellectual property, in particular payments of any kind received by a foreign organization as compensation for the use (granting the right to use) of any patents.

The calculation and withholding of the amount of income tax on the specified income paid to foreign organizations is carried out by the Russian organization (tax agent) in all cases, except for the payment of income that, in accordance with international treaties (agreements), is not taxed in the Russian Federation, subject to presentation by the foreign organization tax agent confirmation provided for #M12293 5 901765862 0 0 0 0 0 0 0 395182877 clause 1 art. 312 Tax Code of the Russian Federation #S ( #M12293 6 901765862 0 0 0 0 0 0 0 395051804 subp. 4 p. 2 tbsp. 310 Tax Code of the Russian Federation #S ).

As an example, consider a situation where a commercial concession agreement is concluded with a Swiss company.

According to #M12293 7 901714421 0 0 0 0 0 0 0 249299594 Art. 7 Tax Code of the Russian Federation #S and #M12293 8 901714421 0 0 0 0 0 0 0 249823888 clause 1 art. 12#S of the agreement between the Russian Federation and the Swiss Confederation of November 15, 1995 “On the avoidance of double taxation with respect to taxes on income and capital”, royalties arising in the Russian Federation and paid to a resident of Switzerland are taxed only in Switzerland if such a resident has the beneficial right to royalty

Provisions #M12293 9 901714421 0 0 0 0 0 0 0 249823888 clause 1 art. 12#S Agreements do not apply if the beneficial owner of the royalties, being a resident of Switzerland, carries out business activities in the Russian Federation (in which the royalties arise) through a permanent establishment located there, and the right or property in respect of which the royalties are paid is effectively connected with such a permanent establishment ( #M12293 10 901714421 0 0 0 0 0 0 0 249823888 clause 3 art. 12#S agreement). In the case under consideration, the activity does not lead to the formation of a permanent representative office of a Swiss company in the Russian Federation; therefore, it applies #M12293 11 901714421 0 0 0 0 0 0 0 249823888 clause 1 art. 12#S agreement and the Russian organization does not withhold corporate income tax from the income paid.

However, a non-resident is the recipient of royalties in accordance with #M12293 12 901765862 0 0 0 0 0 0 0 395182877 clause 1 art. 312 of the Tax Code of the Russian Federation #S must provide the tax agent with confirmation that he has a permanent location in a state with which Russia has an agreement (Switzerland) regulating tax issues. The confirmation must be certified by the competent authority of the relevant foreign state (apostille).

Value added tax

Based #M12293 0 901765862 0 0 0 0 0 0 0 248971910 subp. 4 paragraphs 1 art. 148#S and #M12293 1 901765862 0 0 0 0 0 0 0 294257334 pp. 1, 2 tbsp. 161 of the Tax Code of the Russian Federation #S, if a Russian organization pays a foreign company royalties under a license agreement, the subject of which is exclusive rights to an invention (trade name), then the Russian organization as a tax agent has the obligation to withhold and pay VAT on the amounts of remuneration paid to the foreign organization under a license agreement.

Taxation is carried out at a rate of 18% ( #M12293 2 901765862 0 0 0 0 0 0 0 294781628 clause 4 art. 164 Tax Code of the Russian Federation #S).

Based on the clarifications of the Ministry of Taxes of Russia, set out in letter dated September 24, 2003 N OS-6-03/995@ "On the procedure for calculating and paying value added tax", the tax base specified in #M12293 3 901765862 0 0 0 0 0 0 0 294257334 clause 1 art. 161 of the Tax Code of the Russian Federation #S, when selling goods (work, services) for foreign currency, determined by the tax agent, is calculated by recalculating the tax agent’s expenses in foreign currency into rubles at the exchange rate of the Central Bank of the Russian Federation on the date of sale of goods (work, services), i.e. . on the date of transfer of funds by the tax agent in payment for goods (work, services) to a foreign person who is not registered with the tax authorities as a taxpayer. The tax agent recalculates the tax base when selling goods (work, services) for foreign currency into rubles at the exchange rate of the Central Bank of the Russian Federation on the date of actual expenses (including if these expenses are advance or other payments) regardless of the adopted accounting policy for tax purposes.

The amount of VAT withheld from a foreign company is paid to the budget simultaneously with the transfer of funds to the foreign company under a license agreement ( #M12293 4 901765862 0 0 0 0 0 0 0 295699137

The amount of VAT paid by an organization to the budget as a tax agent is subject to deduction in accordance with #M12293 5 901765862 0 0 0 0 0 0 0 295436991 para. 1 clause 3 art. 171 Tax Code of the Russian Federation #S. The tax deduction is provided upon fulfillment of the conditions established #M12293 6 901765862 0 0 0 0 0 0 0 295436991 para. 3 p. 3 art. 171 Tax Code of the Russian Federation #S.

According to clause 16 of the Rules for maintaining logs of received and issued invoices, purchase books and sales books when calculating value added tax, approved. #M12291 901776354 by Decree of the Government of the Russian Federation dated December 2, 2000 N 914#S, all issued and issued invoices are recorded in the sales book in all cases when the obligation to calculate VAT arises, incl. perform the duties of tax agents. A similar opinion is shared by the Russian Ministry of Finance in letter dated 05/11/2007 N 03-07-08/106: “...It is advisable to prepare invoices in two copies. In this case, the first copy should be kept in the journal of issued invoices and registered in the Book sales, and the second copy - in the journal of received invoices and registered in the Purchase Book as the right to a tax deduction arises."

In tax accounting, positive (negative) exchange rate differences arising from changes in exchange rates are non-operating income (expense) ( #M12293 7 901765862 0 0 0 0 0 0 0 345703165 clause 11 art. 250 of the Tax Code of the Russian Federation #S), and with the accrual method, the date of receipt of the specified income is recognized as the last day of the current month ( #M12293 8 901765862 0 0 0 0 0 0 0 346882816 subp. 7 paragraph 4 art. 271 Tax Code of the Russian Federation #S).

Accounting

When concluding a license agreement, intangible assets (trade name) received for use are taken into account by the user on an off-balance sheet account in an assessment determined based on the amount of remuneration established in the agreement (clause 39 of PBU 14/2007 “Accounting for intangible assets”, approved #M12291 902081954 by order of the Ministry of Finance of Russia dated December 27, 2007 N 153н#S).

Since the Instructions for the application of the Chart of Accounts for accounting of financial and economic activities of organizations, approved. #M12291 901774800 by order of the Ministry of Finance of Russia dated October 31, 2000 N 94н#S, a separate off-balance sheet account is not provided for accounting for intangible assets received for use; an organization can open an account, for example, 012 “Intangible assets received for use.” At the same time, payments for the granted right to use the results of intellectual activity or means of individualization, made periodically, calculated and paid in the manner and terms established by the agreement, are included by the user (i.e., a Russian organization) in the expenses of the reporting period for ordinary activities (clause 5 PBU 10/99 "Expenses of the organization", approved #M12291 901735798 by order of the Ministry of Finance of Russia dated 05/06/1999 N 33н#S).

According to the Instructions for using the Chart of Accounts, these expenses are reflected on a monthly basis (as of the last date of the current month, subject to the conditions of clause 16 of PBU 10/99) in the organization’s accounting in the debit of account 20 “Main production” and the credit of the account for accounting settlements with the licensor, for example account 76 " Settlements with various debtors and creditors."

Example

Romashka LLC entered into a license agreement with the Swiss company Romashka to provide a trade name. Royalties payable monthly (by the 20th of the current month) under the agreement amount to $900,000.

Let's say the US dollar exchange rate on August 20, 2011 was 30 rubles, on August 31, 2011 - 31.5 rubles.

At the time of concluding the license agreement, the following entries must be made in accounting:

D-t 012 - the receipt of an intangible asset for use is reflected (in the assessment established by the contract);

D-t 76/60 K-t 68 - 4,118,644 rub. (900,000 * 18/118 * 30) - VAT is withheld from the amount paid to a foreign company under a license agreement;

D-t 76/60 K-t 52 - 26,588,155.92 rub. (900,000 - 900,000 * 18/118) * 30) - reflects the payment of royalties for August;

D-t 68 K-t 51 - 4,118,644 rub. - paid to the budget VAT withheld from the income of a foreign company;

D-t 20 K-t 76/60 - 24,025,423.72 rub. (900,000 - 900,000 * 18/118) * 31.5) - expenses associated with the use of exclusive rights are reflected;

D-t 19 K-t 76/60 - 4,118,644 rub. - reflected VAT paid on the income of a foreign company for August;

D-t 76/60 K-t 91-1 - 1,144,067.796 rub. (900,000 - 900,000 * 18/118) * (31.5 - 30) - reflects a positive exchange rate difference;

D-t 68 K-t 19 - 4,118,644 rub. - VAT paid to the budget is accepted for deduction;

At the expiration date of the contract:

Kt 012 - the cost of an intangible asset received for use is written off.

As noted above, the amount of VAT withheld from a foreign company is paid to the budget simultaneously with the transfer of funds to the foreign company under a license agreement ( #M12293 0 901765862 0 0 0 0 0 0 0 295699137 para. 2 clause 4 art. 174 Tax Code of the Russian Federation #S).

In accounting, the transfer of funds to a foreign company is reflected in the credit of account 52 “Currency accounts” and the debit of account 76. In this case, the withheld amount of VAT is reflected in the debit of account 76 and the credit of account 68 “Calculations for taxes and fees”. Payment of VAT to the budget is reflected in the debit of account 68 and the credit of account 51 “Current accounts”. The tax deduction for VAT in the amount paid is reflected in the debit of account 68 and the credit of account 19 “Value added tax on acquired assets.”

Maximum royalty limit

According to #M12293 0 901765862 0 0 0 0 0 0 0 345834237 Art. 252 of the Tax Code of the Russian Federation #S expenses are recognized as justified and documented expenses incurred by the taxpayer. Justified expenses mean economically justified expenses, the assessment of which is expressed in monetary form. Documented expenses mean expenses supported by documents drawn up in accordance with the legislation of the Russian Federation. Any expenses are recognized as expenses, provided that they are incurred to carry out activities aimed at generating income.

Based on this, the taxpayer must confirm the actual use of the trademark (company name) in activities aimed at making a profit. And the structure of expenses incurred by type of activity, including license fees, must correspond to the structure of the company’s income.

In other words, if the company’s income is $1,000,000, and license payments (royalties), for example, are $999,999, then, most likely, the tax authorities will recognize them as economically unjustified (unjustified) and aimed at understating the tax base on income tax.

It should be noted that according to #M12293 1 901714421 0 0 0 0 0 0 0 295633603 Art. 40 of the Tax Code of the Russian Federation #S for tax purposes, the price of goods (work, services) indicated by the parties to the transaction is accepted. Until proven otherwise, this price is assumed to correspond to market prices*1.

*1 On July 18, 2011, the President of the Russian Federation adopted and signed Law No. 227-FZ “On amendments to certain legislative acts of the Russian Federation in connection with improving the principles of determining prices for tax purposes” (see the article “Transfer Pricing Law: a brief overview " on p. 18).

However, based on #M12293 2 901714421 0 0 0 0 0 0 0 295633603 clause 2 art. 40 of the Tax Code of the Russian Federation #S, tax authorities, when monitoring the completeness of tax calculations, have the right to check the correctness of the application of prices:

For transactions between related parties;

For commodity exchange (barter) transactions;

When making foreign trade transactions;

If there is a deviation of more than 20% upward or downward from the level of prices applied by the taxpayer for identical (homogeneous) goods (works, services) within a short time.

In turn, in the situation we are considering, a licensing agreement with a foreign entity is a foreign trade transaction (or it is possible that the parties to the licensing agreement are interdependent persons), as a result of which the tax authorities have the right to check the price of the transaction and in the event of its deviation from the level of market prices by more than Additional 20% taxes and penalties.

Since trademarks (company name) are a purely individual thing, the tax authorities are unlikely to be able to determine the market price of specific licensing rights and defend their arguments in court. Although isolated cases of negative outcomes for taxpayers did occur (see, for example, resolution of the Federal Antimonopoly Service of the North-Western District dated October 6, 2005 N A66-5524/2004).

Thus, despite the fact that Russian legislation does not define the maximum amount of royalties under licensing agreements, if they are excessively high (deviation from market prices by more than 20%) for tax purposes, the tax authorities, based on #M12293 3 901714421 0 0 0 0 0 0 0 295633603 Art. 40 of the Tax Code of the Russian Federation #S, they can charge additional amounts of VAT and income tax.

In modern business, organizations very often enter into agreements for the transfer of rights to use intangible assets (copyright, rights to a trademark, service mark, commercial designation, production secret (know-how), etc.) (hereinafter referred to as intangible assets).

The user of the specified intellectual rights periodically transfers to the copyright holder royalties - license payments for the use of a particular object of intellectual property. Let's consider the accounting and tax accounting procedures when paying royalties to foreign copyright holders.

Accounting

In accordance with clause 39 of PBU 14/2007 “Accounting for intangible assets”, approved by Order of the Ministry of Finance of the Russian Federation dated December 27, 2007 N 153n (as amended on December 24, 2010), intangible assets received for use are accounted for by the user (licensee) on an off-balance sheet account at a valuation determined based on the amount of remuneration established in the agreement.

In this case, payments for the granted right to use the results of intellectual activity or means of individualization, made in the form of periodic payments (royalties), calculated and paid in the manner and terms established by the agreement, are included by the user (licensee) in the expenses of the reporting period. Payments made in the form of a fixed one-time payment are reflected in the accounting records of the user (licensee) as deferred expenses and are subject to write-off during the term of the agreement.

FOR EXAMPLE

A Russian organization has concluded a license agreement with a foreign organization - the copyright holder for the right to use the trademark. The contract period is 1 year. The amount under the agreement is RUB 1,416,000. (including VAT transferred to the budget of the Russian Federation - 216,000 rubles). The monthly payment is 118,000 rubles. In accordance with paragraphs. 1 item 2 art. 284 of the Tax Code of the Russian Federation, income of a foreign organization is taxed at a rate of 20% (confirmation of the permanent location of the foreign organization is not provided).

The following entries must be made in the accounting records of a Russian organization:

			Amount (rub.)
The receipt of intangible assets for use is reflected (in the assessment established by the agreement)
Monthly accounting entries during the validity period of the agreement on the transfer of rights to an intellectual property object:
The royalty amount is included in expenses for ordinary activities (118,000 / 118 x 100)
The amount of VAT included in the contract price is reflected (118,000 x 18/118)
VAT withheld by the tax agent
The tax agent withheld income tax from the income of a foreign organization ((118,000 - 18,000) rub. x 20%)		68-profit
Funds transferred to a foreign organization (118 000 - 18 000 - 20 000)
VAT withheld by the tax agent is transferred to the budget
Income tax withheld by the tax agent is transferred to the budget	68-profit
VAT accepted for tax deduction
Accounting entry at the end of the contract:
The cost of intangible assets received for use has been written off

An organization should independently open an off-balance sheet account and document it in its accounting policies for accounting purposes.

Value added tax

In accordance with paragraphs. 1 clause 1 art. 146 of the Tax Code of the Russian Federation, the sale of services on the territory of the Russian Federation is subject to VAT.

According to paragraphs. 4 paragraphs 1 art. 148 of the Tax Code of the Russian Federation, the place of sale of services is recognized as the territory of the Russian Federation if the buyer of services carries out activities in the territory of the Russian Federation. This applies in particular to the transfer, grant of patents, licenses, trademarks, copyrights or other similar rights.

Thus, the provision of services by a foreign copyright holder is subject to VAT, and a Russian organization, when paying royalty payments to a foreign organization, is a tax agent for VAT (clause 2 of Article 161 of the Tax Code of the Russian Federation).

A tax agent is obliged to calculate, withhold from a foreign organization and pay the appropriate amount of VAT to the budget, regardless of whether he himself is a payer of this tax (for example, he may apply special tax regimes, in particular, a simplified taxation system, and not be a VAT payer ).

The transfer of the VAT amount to the budget is carried out simultaneously with the transfer of funds to the foreign counterparty.

In accordance with paragraph 3 of Art. 171 and paragraph 1 of Art. 172 of the Tax Code of the Russian Federation, a tax agent who paid the withheld VAT to the budget has the right to claim this amount as a tax deduction after the above services are registered.

According to paragraph 3 of Art. 171 of the Tax Code of the Russian Federation, tax amounts paid in accordance with Art. 173 of the Tax Code of the Russian Federation by buyers - tax agents. The right to these tax deductions are available to buyers - tax agents registered with the tax authorities and acting as taxpayers, provided that the services were purchased to carry out transactions recognized as objects of taxation.

It should be noted that in accordance with paragraphs. 26 clause 2 art. 149 of the Tax Code of the Russian Federation, the sale in the territory of the Russian Federation of exclusive rights to inventions, utility models, industrial designs, programs for electronic computers, databases, topologies of integrated circuits, production secrets (know-how), as well as rights to use the specified results of intellectual property is not subject to taxation activities on the basis of a license agreement.

Tax on income of a foreign organization

When paying royalty payments to a foreign organization, the Russian organization is a tax agent for the income tax of the foreign organization.

In accordance with Art. 309 of the Tax Code of the Russian Federation, foreign organizations that do not operate through a permanent representative office in the Russian Federation and receive income from sources in the Russian Federation are subject to income tax withheld from Russian organizations - sources of payment of income.

According to paragraphs. 4 paragraphs 1 art. 309 of the Tax Code of the Russian Federation, income from the use of rights to intellectual property in the Russian Federation is subject to taxation. Such income includes, in particular, payments of any kind received as consideration for the use of, or for the grant of the right to use, any copyright in works of literature, art or science, including cinematograph films and films or recordings for television or radio broadcasting, the use (grant of the right use) of any patents, trademarks, drawings or models, plans, secret formula or process, or the use (grant of the right to use) information relating to industrial, commercial or scientific experience.

According to paragraph 1 of Art. 310 of the Tax Code of the Russian Federation, tax is calculated and withheld by the Russian organization paying income to a foreign organization, with each payment of income, in the currency of payment of income.

The tax rate is 20% (clause 1, clause 2, article 284 of the Tax Code of the Russian Federation).

In accordance with paragraphs. 4 clause 2. Art. 310 of the Tax Code of the Russian Federation, the tax agent does not withhold tax in case of payment of income that, in accordance with international treaties (agreements) on the avoidance of double taxation, are not subject to tax in the Russian Federation, provided that the foreign organization presents to the tax agent confirmation of the permanent location of the foreign organization, provided for in paragraph. 1 tbsp. 312 of the Tax Code of the Russian Federation.

Confirmation certified by the competent authority of the relevant foreign country must be provided to the tax agent before the date of payment of income. If the confirmation is drawn up in a foreign language, the tax agent is also provided with a translation into Russian.

The list of current bilateral international treaties of the Russian Federation on the avoidance of double taxation is given in the reference legal systems.

It should be noted that according to paragraph 5 of Art. 346.11 of the Tax Code of the Russian Federation, organizations and individual entrepreneurs using the simplified tax system are not exempt from performing the duties of tax agents provided for by the Tax Code of the Russian Federation (Letter of the Ministry of Finance of the Russian Federation dated June 27, 2013 N 03-08-05/24532).

Tax accounting

In accordance with paragraphs. 37 clause 1 art. 264 of the Tax Code of the Russian Federation, royalties, that is, periodic (current) payments made by a Russian organization for the use of rights to the results of intellectual activity and means of individualization (in particular, rights arising from patents for inventions, industrial designs and other types of intellectual property), relate to other costs associated with production and sales.

It should be noted that according to Art. 252 of the Tax Code of the Russian Federation, expenses, in order to be considered as such for income tax purposes, must be justified and documented. Justified expenses mean economically justified expenses, the assessment of which is expressed in monetary form.

Yulia Khachaturyan,

General Director of NIKA, RISK PLAN

"Economist's Handbook" No. 5 2013

In one of the previous articles, we talked about how to minimize tax payments using agreements involving the payment of royalties and the taxation of such agreements (see the journal "Economist's Handbook" for 2012, "Tax planning using royalties and interest obligations") In this In this article we will dwell in more detail on the legal and aspects of such agreements.

Let us recall that the term “royalty” refers to periodic payments paid under a license agreement or a commercial concession (franchise) agreement. As a rule, they are set as a percentage, for example, of revenue (profit) from the sale of products (performance of work, provision of services). A lump sum payment is a fixed sum of money that is paid under the contract in a lump sum or in installments, roughly speaking, an entrance fee for the use of intellectual property . Sometimes contracts involving the payment of royalties and lump-sum payments also provide for the payment of a security deposit. It is paid in a lump sum and is a kind of obligation of the licensee under the license agreement. Now let us recall the most basic points related to agreements on the transfer of intellectual property rights.

There are four main types of agreement under which intellectual property rights can be transferred:

agreement on the transfer of exclusive rights),

license agreement

and commercial concession agreement,

order agreement.

Under an agreement on the transfer of exclusive rights, an object created by one person (individual, individual, company) becomes the full property of another person as a result of the “purchase and sale” of rights. The original author retains only the rights to the name and some other inalienable rights. Under a licensing agreement, the original owner remains the owner of the intellectual property, and only a small part of the rights to it is transferred to the licensee, for example, the right to display the work. The original owner may continue to use his property in the same way as the licensee. For comparison: if a person has transferred his rights under an agreement on the alienation of exclusive rights, he cannot continue to use his work. A commercial concession agreement is similar in legal nature to a license agreement. But it has its own nuances, which is due to the fact that the original copyright holder is actually selling his reputation. Let us give a specific example to compare the essence of these agreements.

First option: The software developer, under a license agreement, sells the right to use it to a third company whose employees will use the software. The developer retains all his rights.

Second option: A restaurant company, under a commercial concession (franchise) agreement, sells the right to use its well-known and well-known trademark. The original owner will also retain all of his rights, and only part of them will be transferred to the “buyer”. But now virtually all consumers will perceive the “buyer” and “seller” of intellectual property as a single entity. After all, there is only one brand! In order not to discredit the brand, the buyer of the brand must maintain a certain level of products, quality of service, etc. Otherwise, if the level of work with clients under this brand is low, it will depreciate due to the fact that its reputation has been damaged. To ensure that the licensor does not spoil the reputation of the trademark, it is necessary to somehow control the quality of its services. Therefore, service and product quality standards are usually prescribed in such an agreement. In addition, the agreement stipulates the possibility of control by the licensee (the original creator of the intellectual property) over the licensor.

An order agreement is an agreement similar to agreements on the transfer of exclusive rights or licensing. But at the moment of its conclusion, the object of copyright itself does not exist. It must be created in the future and rights must be transferred to it. Payment of royalties is expected only under license agreements and commercial concession agreements. Since in the agreement on the transfer of exclusive rights they are redeemed immediately and in full and, as a rule, no periodic payments are expected. Payment of royalties under an order agreement is also very rare. Therefore, below we will dwell in more detail on two types of agreements under which license payments are most often made: a license agreement and a commercial concession (franchise) agreement. What must be provided for in an agreement involving the payment of royalties and lump-sum payments: general rules Of course, the examination of the agreement and its approval will be carried out by a lawyer. However, in many organizations it is expected to negotiate a contract with many services, so let us pay attention to some important points related to such contracts. The rules for drawing up a commercial concession and franchising agreement are very different, so below we will separately consider the rules for their drafting and evaluation.

In the meantime, let us pay attention to the general points that need to be taken into account when drawing up both types of contracts.

The contract should be as transparent and understandable as possible.

The rules governing copyright and patent law are contained in the Civil Code of the Russian Federation. The concepts and terms used in copyright and patent law seem complex and specific to the untrained person. However, if you understand their essence, copyright and patent law itself will be simple and understandable for you. If you read an agreement that involves the payment of royalties, it should be clear and transparent so that both you and your counterparty clearly understand their rights and obligations. Very often the contract is drawn up in such a way that little can be understood from it at all. The most difficult case in the practice of the author of this article was the following. They brought a contract for examination, which, relatively speaking, was written in a language that I do not know. It clearly should have been accompanied by a line-by-line translation, since it consisted of phrases like “Legal title to the subject matter of the contract remains entirely with the owner...” . Most of the beautiful and, apparently, smart, from the position of the author of the contract, terms that he used were simply absent from the Civil Code. An attempt to explain to the counterparty that without attaching a dictionary to the contract that explains incomprehensible terms, none of them will understand anything, met with a storm of indignation from the author of the “masterpiece,” whose talent, intelligence and floridity of thought shown when drawing up the contract, I did not appreciate. However, it is better if you insist on your own in such cases and ask to redo the contract or accept your changes.

Please note that if you enter into an agreement with a foreign counterparty, the legal rules governing copyright and patent law in the two countries may be very different, which can lead to specific problems. I will give a specific example from my practice. At one time, our company had to conclude, in fact, a sublicensing agreement from the perspective of Russian copyright law. Let us remind you what the essence of the sublicense agreement is. The original copyright holder, under a license agreement, transfers the rights to use intellectual property to the licensee, who, in turn, transfers the rights to use the intellectual property to the sublicensee. At the same time, the agreement between the original copyright holder and the first licensee states that he has the right to grant rights to third parties to the same extent that the original copyright holder granted him. Roughly speaking, the licensee buys the rights to an object of intellectual property, and then sells the same rights to other parties. Moreover, he can provide them to the sublicensee only within the limits of those rights and those methods of use that are provided for in the license agreement for the licensee (clause 2 of Article 1238 of the Civil Code of the Russian Federation). At the same time, he retains the right to use the object.

But in the UK, for example, in order to sell someone’s rights to third parties, it is not necessary to buy them for use for yourself. This is reminiscent of an agency relationship. The agent is given an order to sell something, to find a customer, but in order to sell the product, the agent does not acquire it as his own property. He's just an intermediary.

At one time, I received an agreement for examination, according to which our company acquired intellectual property rights from such an “agent.” The contract directly stated that the “seller” does not have any rights to the intellectual property, the rights to which he resells to us. From the point of view of Russian law, such an agreement is doubtful. Of course, the parties have the right to enter into any agreement, both those provided for by the Civil Code of the Russian Federation and other laws, and those not provided for. On the other hand, the legality of transferring rights that the licensee does not have to the sublicensor within the meaning of Russian civil legislation is very doubtful. Such a transaction may be declared invalid in court. In this particular case, we stated in the contract that English law applies to the legal relations arising from this transaction. In contracts concluded with a foreign counterparty, we have the right to stipulate this. Therefore, the question of the validity of the contract from the point of view of Russian law automatically disappeared. However, of course, applying “foreign” law to a bilateral agreement is not a very good option. To guarantee the safety of your side, you need to study the law of the counterparty, and this is quite problematic. Therefore, if possible in a specific situation, bring the agreement as close as possible to Russian legislation.

Make sure that the contract conveys all rights that you need or may need in the future.

For example, a person who intends to transfer rights to third parties under a sublicense agreement in the not very distant future very often forgets to stipulate such a right in the agreement. Or the parties do not indicate some kind of authority, the absence of which subsequently makes it difficult to use the object. Now let’s look at what nuances need to be taken into account in each of these types of agreements: franchising and licensing agreements.

Franchise agreement

Under a franchise agreement, the copyright holder grants the user the right to use the rights to his trademark, service mark, commercial designation, production secret (know-how), etc. Please note that the agreement must indicate the scope of rights to the intellectual property that is granted to the user . The franchise agreement is subject to state registration with the federal executive authority for intellectual property. If this requirement is not met, the contract is considered void. An important point is that the parties to a commercial concession agreement can be commercial organizations and citizens registered as individual entrepreneurs.

Let us remind you of the difference between commercial and non-commercial entities. A commercial entity pursues the goal of making a profit in its activities. Non-profit entities – other purposes. The concepts of “commercial entity - non-profit entity” and “state” and “non-state” should not be confused. Many commercial organizations are state-owned (for example, government institutions), and, conversely, non-profit ones are created by private individuals and often earn quite a large amount of money. One well-known non-profit educational institution (private university) decided to sell its already promoted trademark to an unknown private university so that it would work under it. However, it was not possible to register the franchising agreement, since it contradicted the law in terms of the non-profit organization not having the right to enter into such agreements.

The franchise agreement may provide for the user’s right to allow third parties to use a trademark, service mark, etc. (i.e. he can enter into a subconcession agreement). The scope of rights that the user can grant to third parties is specified in the concession agreement. A commercial subconcession agreement cannot be concluded for a longer period than the commercial concession agreement on the basis of which it is concluded. If you enter into a subconcession agreement as a user, carefully read the main agreement between the copyright holder and the first user (the one who is currently concluding an agreement with you.) After all, if the commercial concession agreement is invalid, the commercial subconcession agreements concluded on the basis of it are also invalid. If the counterparty refuses to show a copy of it, it is better to refrain from concluding a subconcession agreement. Already by force of law, the copyright holder is obliged to transfer to the user technical and commercial documentation and provide other information necessary for the user to exercise the rights granted to him under the commercial concession agreement, as well as instruct the user and his employees on issues related to the exercise of these rights. However, it is better to specify in more detail the composition of the documentation that the copyright holder must provide, on what issues and in what form.

As a general rule (i.e., unless otherwise expressly stated in the contract), the copyright holder is obliged to:

 ensure state registration of the franchising agreement;

 provide the user with constant technical and advisory assistance, including assistance in training and advanced training of employees;

 control the quality of goods (work, services) produced (performed, provided) by the user on the basis of a commercial concession agreement.

In the franchising agreement, no matter which party you represent, pay special attention to the clauses regulating the issues of monitoring the quality of goods, works, and services produced under the trademark to which the rights are acquired. The contract often states that an inspector from the copyright holder has the right to visit the user to ensure that the quality of the user’s products meets the standards developed by the copyright holder. But the task of the copyright holder is not only to control the user, but also to help him. Therefore, write in detail in the contract how it should be carried out.

Let's give a specific example.

The company is engaged in the restaurant business. She decided to grant the right to use the trademark to a third party. However, this company has, firstly, requirements for the menu for customers, secondly, requirements for product quality, and thirdly, requirements for waiter service for customers. Requirements for the menu and product quality can be transmitted on paper or electronic media. But the owner of the rights will most likely have to train the staff. The frequency, timing of training, the procedure for conducting personnel assessments, etc. are best spelled out in detail in the contract. The user may be subject to requirements relating to the external and internal design of commercial premises used by the user in the exercise of the rights granted to him under the contract; the obligation to provide clients with all additional services that they could count on by purchasing a product (work, service) directly from the copyright holder. Please note that the user is obliged not to disclose the production secrets (know-how) of the copyright holder and other confidential commercial information received from him. Such information may be contained not only in technical documentation, but also in documents regulating the assessment and training of personnel. Read the contract very carefully to see if there are any restrictions on your rights.

The presence of any of them may devalue the contract for you. In particular, the contract may state:

 the obligation of the copyright holder not to provide other persons with similar rights for their use in the territory assigned to the user or to refrain from their own similar activities in this territory;

 the user’s obligation not to compete with the copyright holder in the territory covered by the franchise agreement;

 the user’s refusal to obtain similar rights under franchising agreements from competitors (potential competitors) of the copyright holder;

 the user’s obligation to sell his goods, works, services under the trademark of the copyright holder at prices similar to his;

 the user’s obligation to sell goods, perform work or provide services under the trademark exclusively within a certain territory;

 the obligation of the user to agree with the copyright holder on the location of commercial premises used in the exercise of exclusive rights granted under the contract, as well as their external and internal design.

Please note that the copyright holder has the right to refuse to fulfill the commercial concession agreement in whole or in part in the following cases:

Violation by the user of the terms of the contract on the quality of goods produced, work performed, services provided;

Gross violation by the user of the instructions and instructions of the copyright holder aimed at ensuring compliance with the terms of the contract of the nature, methods and conditions of use of the granted set of exclusive rights;

Violation by the user of the obligation to pay remuneration to the copyright holder within the period established by the contract.

The unilateral refusal of the copyright holder to fulfill the contract is possible if the user, after the copyright holder sent him a written demand to eliminate the violation, did not eliminate it within a reasonable time or again committed such a violation within one year from the date the specified demand was sent to him. Early termination of a commercial concession agreement concluded with a specified period, as well as termination of an agreement concluded without specifying a period, are subject to state registration in accordance with the procedure.

License agreement

With a license agreement, everything is somewhat simpler. However, we advise you to make sure that it clearly states the territory in which the intellectual property object is used, the rights that the “buyer” has the right to exercise in relation to the object, and the amount of remuneration for the license.