When should it be used?
- When one party wishes to share proprietary equipment with another party; and
- The parties are Australian entities
The agreement is also suitable when one of the parties is a Commonwealth Entity.
Whilst it will generally be the University providing equipment to an industry partner, the agreement is structured so that either party could be the Licensor.
An Equipment Licence Agreement can be used to provide equipment for use in a project or other collaboration. It can also be used for other situations requiring the exchange of equipment, for example, where an industry partner wishes to test a prototype to decide whether to sign a commercialisation licence or purchase agreement.
The template may need to be amended if the Equipment will be used to create any IP.
When should it not be used?
- When the equipment could pose significant environmental or health and safety risks. Further assessment of risks should be undertaken in these circumstances and a bespoke agreement may be required
- When one party is not an Australian entity
Key considerations when completing the template
The following table is provided as a guide to help the parties appreciate the key considerations that each party will have when negotiating an Equipment Licence Agreement using the template.
The template is provided in the Standard track. Discussing and understanding each party’s needs and concerns up front will help you reach an agreement more quickly.
For organisations, particularly SMEs, that have not previously been asked to enter this type of agreement, this table will help you understand what the key provisions are and what you need to discuss and agree in order to finalise the agreement from the template.
Additional plain English guidance on the meaning of key clauses is provided in a separate annotated version of the template.
This table sets out the key points each party needs to consider when using the Equipment Licence Agreement. Understanding your own key considerations, as well as those of the other party, will help you to negotiate a fair and reasonable agreement that works for both parties.
| Key points |
Equipment Licence Agreement Provision |
University (Licensor) |
Collaborator (Licensee) |
| Details of the Equipment being licensed |
- A clear description of the Equipment being licensed including its technical specifications
- If the intention is that the Equipment will be used to generate new IP, the template may need to be amended to include provisions for ownership and rights to this IP
|
- Descriptions should have enough detail to make it clear what Equipment will be shared
|
- Ensure you understand what Equipment is being received and that it will meet your requirements
|
| Restrictions on use |
- A clear description of whether there are any restrictions on how the Equipment can be used, for example, if the Equipment cannot be used in a particular manner or using particular products
- This should be defined as clearly as possible
|
- Ensure that the Equipment is not used for any purpose that may impact on it or its safe use
|
- Understand the restrictions (if any) on how you can use the Equipment and ensure this covers all of your intended uses
|
| Use & Care Instructions |
- Standard terms relating to how the company needs to use the equipment and care for it
|
- Ensure the Collaborator properly uses and looks after the Equipment so as to minimise damage and loss
|
- Ensure you understand your obligations to use and look after the Equipment
- Ensure you have appropriate insurance to cover any damage or liabilities
|
| Fees |
- If a Fee is being charged for the Equipment licence, this needs to be discussed and agreed
- The Fee may be a one-off payment or a monthly fee
|
- Decide whether a Fee is appropriate and discuss this with the Collaborator as early as possible.
|
- If a Fee is being charged, this is usually negotiable and will depend on the value of the Equipment (including costs incurred by the University to make it)
- Ensure you understand the delivery and return costs as you will be responsible for these
|
| Confidential Information exchanged |
- A clear and concise description of scope of the information that each party intends to share with the other and which that party considers to be confidential
- How long this information must be kept confidential should also be included. Often this time period will be 5-7 years, although longer periods may be appropriate. In most cases the term will be the same for both parties
|
- Ensure if confidential information is exchanged with the Equipment that this is clearly identified
- Ensure this information is kept confidential long enough so as not to impact on your research and commercialisation activities. For example, so that others cannot use this information before the University has published it or filed patent applications
- Understand what restrictions apply to confidential information shared with you by the Collaborator. This will usually include information about their work with the Equipment
|
- Ensure you understand what information you receive from the University needs to be kept confidential
- Ensure it is clear what information you will share that you consider to be confidential information and that this is kept confidential long enough so as not to impact on your commercial activities
- For example, so that the University does not publish the information and competitors do not benefit from this confidential information whilst it still provides a competitive advantage
|
| Liability Cap |
- An agreed financial limit of liability for risks arising under the Agreement
- This cap will not apply to those liabilities that are commonly excluded, or specifically uncapped or which cannot be capped by law
- The level of the cap should be linked to the value of the fees being charged or a multiple of these fees
|
- The agreed cap should represent a level appropriate for the fee being charged, the value of the Equipment and is consistent with your liability insurance limits
|
- Ensure the cap is consistent with your liability insurance limits
|
