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:
“I rather think the cinema will die. Look at the energy being exerted to revive it—yesterday it was color, today three dimensions. I don’t give it forty years more. Witness the decline of conversation. Only the Irish have remained incomparable conversationalists, maybe because technical progress has passed them by.”
—Orson Welles (1915–1984)
“But a problem occurs about nothing. For that from which something is made is a cause of the thing made from it; and, necessarily, every cause contributes some assistance to the effect’s existence.”
—Anselm of Canterbury (1033–1109)