Technical Assistance Fees
In many contracts involving the use of knowhow (and associated IP), 'technical assistance' may be encountered as a part of the contractual process, particularly in developing country contracts. The assistance comprises services which are not in the nature of IP but are needed by the licensee to accomplish its objectives. They are of a specialized nature linked to the knowhow, for instance, procurement of equipment, the setup of a production facility or training of licensee personnel, on-site and off-site. These costs would bear no relationship to the royalties, although they are most often provided by the licensor. ( See *Licensing Guide For Developing Countries', World Intellectual Property Organization (WIPO), 1977, Section H).
The cost of such services arises from delineating the skill-mix and 'man'-hours of effort involved (domestic and expatriate personnel) and providing for supervision overhead. The costs of different skills is in the public domain and can be readily estimated. The overhead percentage, however, is a negotiated element
Read more about this topic: Royalty Rate Assessment
Famous quotes containing the words technical and/or assistance:
“When you see something that is technically sweet, you go ahead and do it and you argue about what to do about it only after you have had your technical success. That is the way it was with the atomic bomb.”
—J. Robert Oppenheimer (1904–1967)
“Each [side in this war] looked for an easier triumph, and a result less fundamental and astounding. Both read the same Bible, and pray to the same God; and each invokes His aid against the other. It may seem strange that any men should dare to ask a just God’s assistance in wringing their bread from the sweat of other men’s faces; but let us judge not that we be not judged.”
—Abraham Lincoln (1809–1865)