Commercial IP in India: Licensing, Franchising & IP Transactions
The transactional side of intellectual property in India — how rights are licensed, franchised, assigned and transferred, as distinct from registering them. The IP statutes, the Contract Act and the Competition Act, and — on every cross-border deal — FEMA and the Income-tax Act 2025 all run through this work. This page frames the four workstreams below; each has its own page.
What we do.
“Commercial IP” is the transactional side of intellectual property – how rights are licensed, franchised, assigned and transferred – as distinct from registration IP (securing trademarks, patents, designs and copyright), which our IP-registration pages cover. In India this work runs on the IP statutes – the Trade Marks Act 1999, the Patents Act 1970, the Copyright Act 1957 and the Designs Act 2000 – together with the Indian Contract Act 1872, the Competition Act 2002 (which polices exclusivity and resale terms through the CCI), and, for anything cross-border, the Foreign Exchange Management Act 1999 (FEMA) and the withholding-tax rules under the Income-tax Act 2025. Two features set India apart from the UAE: the law contains distinctive mandatory formalities and protections – patent assignments that must be in writing and registered, copyright assignments with statutory terms and a reversion right, and compulsory and statutory licensing of patents and copyright – and the cross-border money flows (royalties, technical fees) are governed by FEMA and tax in a way that shapes every deal. This page frames the four commercial-IP workstreams below; each has its own page. Deep tax structuring is handled with our corporate-tax colleagues. Confirm the current position before relying on it.
At a glance
- Commercial vs registration IP: this cluster is about using and moving IP rights – licensing, franchising, assignment and technology transfer – not registering them
- Franchising: no dedicated franchise statute – runs on the Contract Act 1872, the Trade Marks Act 1999, Competition Act 2002 / CCI scrutiny, and FEMA for cross-border fees
- Licensing: trademark, patent, copyright and software licences – with two India-specific overlays, compulsory licensing of patents (s. 84, Patents Act) and statutory licensing in copyright
- Assignment: distinctive mandatory formalities – patent assignment in writing and registered (s. 68, Patents Act); copyright assignment with statutory terms and a 5-year reversion (s. 19); trademark assignment with or without goodwill; stamp duty applies
- Technology transfer: governed by FEMA (royalty / technical-fee remittance), SCOMET export controls, and withholding on fees for technical services
- Tax & holding: India offers a narrow patent box (≈10% on royalty from patents developed and registered in India) and GIFT-IFSC incentives – but GAAR, POEM and transfer pricing constrain artificial IP-holding structures; deep tax sits with our corporate-tax colleagues
The four commercial-IP workstreams
- Franchising – structuring franchise and master-franchise arrangements, the trademark and brand licence at the centre of the system, competition-law limits on exclusivity, disclosure, and the cross-border fee and FEMA position.
- Licensing – trademark, patent, copyright and software licences; exclusive vs non-exclusive; royalties and quality control; and the India-specific compulsory- and statutory-licensing regimes.
- IP assignment – assigning IP with the mandatory Indian formalities, employee- and founder-created rights (the startup angle), assignment in M&A and group reorganisations, registration and stamp duty.
- Technology transfer – transfer of technology and know-how, R&D and joint development, software and IT-services arrangements, the SCOMET export-control overlay, and the FEMA and withholding-tax treatment of technical fees.
How this connects to corporate, cross-border and tax
Commercial IP rarely sits on its own. A licence or a franchise is a commercial contract; an assignment usually happens inside an M&A or group reorganisation; and almost every arrangement the firm handles is cross-border, so the FEMA treatment of royalties and technical fees and the withholding-tax position under the Income-tax Act 2025 run through all of them. Those threads connect to our Commercial Contracts and Cross-Border Structures work, and – for the India–UAE corridor – to the Commercial IP – UAE cluster.
On holding and tax, India is deliberately different from the UAE. There is no free-zone 0% regime that rewards parking IP in a holding company; instead India offers a narrow patent box (a concessional rate of roughly 10% on royalty from a patent developed and registered in India, available to resident patentees) and the GIFT-IFSC incentives, while anti-avoidance rules – GAAR, place-of-effective-management (POEM), and transfer pricing – actively discourage IP-holding structures that lack genuine commercial substance. That is why this cluster has no standalone “IP holding structures” page (unlike the UAE one): the India position is covered as a structuring note here and in the related pages, with the detailed tax planning handled by our corporate-tax colleagues so the legal structure and the tax position are built together.
Cross-links: the registration-IP pages (Trademarks, Patents, Copyrights, Designs); Commercial Contracts and Cross-Border Structures (Corporate & Commercial – India); the Commercial IP – UAE cluster (cross-border corridor); GIFT City (IFSC) – India.