TERRITORIAL PUBLISHING PROVISIONS
Ivan Hoffman, B.A., J.D.
Here is the situation: you are a rights owner (“Owner”) and are entering into an
agreement (“The Agreement”) for the exploitation of some or all of the rights
you own by another party (“Licensee”) in another territory.
What are some of the issues that are presented by this type of
will limit this article to a discussion about such a transaction where “you” are
a publisher of books (in any format).
However, these issues also apply in the instances where you have
rights to other materials.
Do You Even Own the Rights?
Initially, the concept of being a rights owner needs some preliminary
If you are not the sole creator of the work and instead have acquired some or
all of the rights in the work from that creator, then of course you must
actually own the respective rights before you can enter into The Agreement to
have the Licensee use and exploit those rights.
Read “The Fundamental Principle Under the
United States Copyright Law.”
This may seem self-evident but often parties believe they own rights
but in fact they do not.
This error is often because there is either no written agreement
transferring those rights exclusively to the Owner or the acquisition agreement
is woefully deficient or vague and uncertain.
Also read the series of articles under the titles
“Precise Contract Language.”
In the event that there is no sufficient written agreement between the
creator and you, then you have a very legally uncertain situation, one that
makes effective exploitation of the rights all but impossible.
Also read the series of articles under the titles
“A Legal Nightmare: The Unwritten License.”
Without a transfer or ownership of exclusive rights, you are generally not in a
legal position to exploit or allow others to exploit the rights for a number of
reasons not the least of which is that The Agreement will generally require you
to transfer or license exclusive rights.
Moreover, if you do not have a written and signed transfer of
exclusive rights from the creator, you do not have the right to transfer and
assign any rights to the Licensee. Read “The Right To
Transfer Copyright Licenses.”
So the failure to
have a valid, written and signed agreement generally makes the project unusable
from your standpoint.
Thus, you have to examine the written agreement you have with the creator to
make sure that you in fact and in law own the respective rights, exclusively,
including the exclusive rights to market, sell and distribute the work in the
territory in question and that you have the express right to transfer and assign
your rights to another party.
But so that this article does not end here, let’s assume that you have these
The Territory Defined
The territory can be either a geographically defined territory or one defined by
other factors, such as language or other parameters.
In the latter instance, the territory can be further geographically
defined such as the right to sell and exploit a work in a given geographical
region in a given language and thus the license of rights provisions in The
Agreement would define limitation this as well.
So let’s say that you are licensing the right to translate a book into
Spanish for sale somewhere.
The concept of territory has to be defined in terms of where the
translated work can be sold.
If it is to be sold only in
There are additional issues that relate to “territory” in the above context.
Are the rights to sell in Spanish exclusive rights or do you have the
right to make other Spanish language deals?
And if the rights to sell the work in Spanish are exclusive, are those
rights exclusive only in
But what if the Licensee wants to sell the book within the geographic and
language-territory but to a party who is intending to sell it outside the
In other words, the Licensee can claim that it is in fact selling the
book in the language in the territory, although the intent of the parties is to
prevent sales outside the territory.
As you can see, merely saying in The Agreement that the Licensee may
only sell the book within the territory is not sufficient and creates a
substantial lack of clarity.
An agreement should always solve more problems than it creates and in
this instance, leaving it as indicated (or copying it from a form etc.) is
likely to be the source of the problem.
Thus, the agreement must restrict the Licensee from exercising any
rights to sublicense and preventing the Licensee from exporting from the
territory to some place outside the territory.
Some agreements may talk about “open market” sales.
This generally refers to a situation in which, although the territory
is defined and the rights licensed in that territory are stated to be exclusive,
the Licensee is granted the further right to sell the book non-exclusively in
the rest of the world, the so-called open market.
This is a potential legal nightmare from the Owner’s standpoint.
Not only does it license broad rights for what may amount to no
additional fees, but significantly reduces the likelihood that Owner can make
other deals in those “open market” territories since there may be a market for
only one version of the book and if the Licensee is already in the market, the
Licensee will likely control that market, leaving the Owner without the ability,
as a practical matter, to make another deal.
Indeed, the mere fact that the Licensee has non-exclusive rights
within that “open market” by definition will prevent the Owner from making any
exclusive deals within the same “open market.”
The Role of the Internet
Now along comes the technology complications presented by the Internet.
It is one thing to restrict sales within a geographic territory in the
off line, printed version world.
But given that the “territory” online is everywhere, what provisions
must be included in The Agreement in this regard?
If the book is going to be available online, The Agreement should
provide that the download be geo-locked so that only site visitors from within
the territory can view and download the book.
The Agreement can also restrict the sale/downloads by the Licensee
online to only sales/downloads via specific sites, reserving the right of the
Owner to sell and offer downloads via other sites.
Clearly the above issues represent only a small sample of the “territorial”
issues presented by any sort of license or other agreement.
This article is certainly not intended to be exhaustive of all of the
said issues or indeed of the many other issues presented by any sort of license
or other agreement.
The point however is that what may seem self-evident is in fact and in
law, not self-evident at all.
Any party, whether Owner or Licensee, contemplating getting into any
form of such transaction should always be represented by an attorney experienced
in these areas of the law.
Trying to save money by “doing-it-yourself” can turn out to be quite expensive if things go wrong. Read “The Do It Yourself Publishing Lawyer.”
Copyright © 2003, 2019 Ivan Hoffman. All Rights Reserved.
This article is not legal advice and is not intended as legal advice. This article is intended to provide only general, non-specific legal information. This article is not intended to cover all the issues related to the topic discussed. You should not rely on this article in any manner whatsoever and you should not draw any conclusions of any sort from this article. The specific facts that apply to your matter may make the outcome different than would be anticipated by you. This article is based on United States laws but the laws of other countries may be different. You should consult with an attorney familiar with the issues and the laws of your country. This article does not create any attorney client relationship and is not a solicitation.
No portion of this article may be copied, retransmitted, reposted, duplicated or otherwise used without the express written approval of the author.