ARTICLE · 18 SEPTEMBER 2026
What Should A Licensing Agreement Between Related Businesses Include?
A licensing agreement lets one business use intellectual property another business owns, without transferring ownership. Companies in the same group in New Zealand often share a brand or a system with nothing in writing. Each company remains a separate legal entity under the Companies Act 1993, regardless of who owns the shares. An undocumented arrangement gives the user no right it can prove and no right it can defend. That gap shows up when a shareholder falls out, an entity sells, or a liquidator arrives.
New ZealandIntellectual Property
Summary
- Each company in a group remains a separate legal entity under the Companies Act 1993, so a licence between them needs the same documentation as any commercial arrangement.
- Without a written licence, the licensee cannot prove its right to use the intellectual property if an entity sells, a shareholder dispute starts, or a liquidator takes over.
- Where one entity sits outside New Zealand, transfer pricing rules require the royalty to reflect what unrelated parties would agree, and Inland Revenue puts the onus on the taxpayer.
- This guide explains licensing agreements between related businesses for company directors and business owners in New Zealand.
- LegalVision’s commercial contracts lawyers advise groups on setting termination and change of control triggers, sublicensing rights between entities, and confidentiality where the licence covers a proprietary process.
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The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.
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