What are perpetual, irrevocable and royalty-free licences?

Licences are sometimes expressed to be ‘perpetual’, ‘irrevocable’ or ‘Royalty-free’, but those terms can be interpreted in a variety of ways. It is important to properly specify what these terms mean in each case:

1. •

   ‘perpetual’ licences: clarify whether this means that the licence is ‘never-ending’ or merely of an ‘indefinite Duration’ until terminated in accordance with its terms. Alternatively, specify a long fixed-term (eg 20 years) rather than having a contract of open-ended duration

2. •

   ‘irrevocable’ licences: clarify whether this means that the licence cannot be revoked or terminated under any circumstances in Perpetuity or that the licence cannot be revoked, other than subject to the term and termination provisions elsewhere in the agreement. There should be no potential conflict or uncertainty between the licence being expressed to be ‘irrevocable’ in one clause, and terminable in another

3. •

   ‘royalty-free’ licences: clarify whether this means that no additional licence payments are due over and above specified Fees identified in the agreement if this is the case

If no payments of any kind are due