Licensing laws are used by governments to control market forces and equalize opportunities. They fall into three categories: empowering people, products, and distribution. Licensing is not an independent branch of law but falls under contract, labor, or intellectual property law. Licensing laws regulate professions, product sales, trademarks, copyrights, music, and software. They set out terms for legal copying and distribution and penalties for infringement.
There are hundreds of thousands of licensing laws in place around the world, but most fall into one of three categories: laws that empower people, laws that empower products, and laws that empower distribution. Governments use licensing laws as a way to control certain market forces and as a means to equalize opportunities. Licensing laws regulate the type of people who can participate in certain professions, dictate how certain products can be used, and set rules on the ways in which certain intangible rights can be transmitted or exploited.
Licensing law is an aspect of a country’s domestic law, but is not typically an independent branch of law in its own right. Most of the time, licensing falls under the contract law, labor law, or intellectual property law of a jurisdiction. The licenses touch many areas and are available in a variety of formats.
Any exam or licensing requirement is the product of a licensing law. Some of the most familiar licensing laws are those related to driving a car. Most countries, and within some countries, individual states or provinces, have specific laws dictating who is and is not eligible for a driver’s license. Similar laws regulate who can enter certain professions, especially doctors and healthcare professionals, teachers, pharmacists and lawyers.
Products may also be licensed in some cases. Product licensing laws regulate things like who can sell certain products, how brands can be identified, and who can control the distribution of goods or services. Most of the time, these kinds of laws are designed with the dual purpose of helping product owners protect the intrinsic value of whatever they are selling or distributing and minimizing consumer confusion in the marketplace.
Trademark licensing laws work like this. According to most countries’ trademark schemes, only certain people are eligible for trademark protection. A trademark prohibits other people from using a confusing name, image or logo to sell a similar product, but also requires the owner to take steps to actively protect the trademark and avoid infringement.
Another common set of licensing regulations relate to copyright. Copyrights control how printed or published works can be shared and distributed. These types of licensing laws govern how copyrights can be temporarily granted or extended for certain permitted copies. A director who is adapting a novel for the screen, for example, usually needs to have a copyright license on the book’s content before proceeding to avoid an infringement lawsuit.
Music licensing laws and software licensing laws work in a similar way. In particular, since the advent of the Internet, music and software are often copied and distributed without permission. The licensing laws in these areas set out the terms of legal copying and distribution and outline the penalties for infringement.
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