What is copyright licensing

Copyright licensing is the process whereby an artist grants permission for their artwork to be used in a specific way, under agreed terms. The artist (the licensor) retains ownership of their copyright while allowing another party (the licensee) to reproduce, publish or communicate copies of the artwork. This might involve permitting a person to apply a copy of the artwork to merchandise, use copies of the artwork as part of commercial branding (e.g. as a background to a website) or using copies of the artwork on the cover of a book.

There is no one-size-fits-all approach to copyright licensing, however a licence should outline key details such as:

• How the artwork can be used (e.g., prints, clothing, packaging).
• Duration of the licence (e.g., one-time, ongoing or for a specified period of time).
• Territory (e.g., local, national or international).
• Payment terms (e.g., royalties, flat fees, or other benefits).
• Additional uses (such as advertising the product using the artwork).

Licensing can ensure that artists maintain control over their work while gaining financial and professional benefits. Ethical and fair licensing practices help support both artists and businesses, creating opportunities for collaboration while protecting cultural integrity—especially in Indigenous art.

Licensing can provide financial and other benefits (such as publicity) to the artist. Payment might be a fixed amount, ongoing royalties, or other contributions like funding community projects or offering training. However, artists should ensure these extras do not replace fair payment and consider getting legal or professional advice before signing any agreement.

If you want to engage in product licensing as a business, you should develop a board-approved merchandise strategy. This plan should outline how licensing will be managed, how artists will be engaged, and address any relevant cultural considerations such as Indigenous Cultural Intellectual Property (ICIP). An ICIP protocol should be established to protect and respect artists’ rights.

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Licensing in action

Licensing Aboriginal and Torres Strait Islander art is about working together in a fair and open way. Everyone involved—artists, designers, and businesses—brings their own skills to create and sell products that benefit the artist, the art centre, and businesses.

In most product manufacturing scenarios, an artist (typically the licensor, who owns the copyright in the artwork) works with a designer or manufacturer (the licensee, who reproduces the artwork) to apply their artwork to products like clothing, homewares, or merchandise. These products are then sold and distributed.

Since licensing can be complex, it’s important to make sure agreements are clear, written down, and understood by everyone, regardless of language or literacy levels. The artist should always be informed, consulted, and give approval at key points in the process.

Good licensing is built on trust, respect, and communication. The Indigenous Art Code is a great guide to ensure ethical and fair practices.

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Obtaining a licence from the artist

An art centre must have a copyright license from the artist to reproduce, publish or communicate the artwork to the public. There are different ways that the art centre might obtain a licence from the artist.

Art centre member agreements and copyright licensing

Some art centre member agreements may already grant the art centre permission to exercise some of the exclusive copyright rights in connection with an artist’s artwork that was created at the art centre. If the agreement allows this, the art centre may be permitted to enter into agreements with manufacturers to create products without needing a separate legal agreement with the artist.

However, even in these cases, best practices such as transparency, fairness, prior consultation, informed consent, and cultural protocols must be followed. The art centre should ensure that artists:

• Are aware of and happy with the third party licensing deals.
• Receive payments for their artwork’s use.
• Understand and approve any final product design/s before production.

The membership agreement must be clearly written and signed by the artist. It should also specify the licence scope, outlining exactly what rights the art centre has.

The standard Arts Law membership agreement includes a copyright clause that permits the art centre to act as an artist’s agent, negotiating licences with third parties for merchandise production. However, this agreement does NOT allow the art centre to create merchandise on its own.

If an art centre is using an older version of the Arts Law template, it may only cover art sales and not copyright management. This means centres should check their agreements carefully to ensure they correctly reflect their current licensing needs.

Separate copyright agreements

If an art centre’s membership agreement does not address copyright or permit third party manufacturing or design or products, the art centre may still have separate copyright agreements with some or all of its artist members. These agreements may give the art centre permission to use an artist’s work for merchandise production. In this case, the art centre can likely rely on such agreements to create and sell products featuring member’s artwork.

However, as above, best practices and cultural protocols must still be followed. Respecting artists’ rights and keeping them involved in the process helps maintain fairness and transparency while supporting ethical licensing.

Best practice copyright licenses

If an art centre doesn’t already have a copyright agreement with the artist, it must enter into a new, specific agreement with the artist before manufacturing products.

Arts Law has a number of best practice copyright licences for art centres:

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Is it a licence or an agency agreement?

It’s important to understand if the rights given to the art centre in the membership agreement or separate copyright agreement are a licence to exercise copyright rights or just an agency agreement. Agency agreements typically allow the art centre to act on behalf of the artist, including to enter into certain types of agreements with third parties on the artist’s behalf.

Notably, an agent owes comprehensive fiduciary duties to their principal (in this case, the artist), including the duty to act in good faith, avoid conflicts of interest, maintain confidentiality, exercise reasonable care and skill, account for all funds and property, and prioritise the principal’s interests above their own in all matters within the scope of the agency relationship.

Agency vs. licence

If the art centre only has agency rights (as per the standard Arts Law template), it can enter copyright agreements on behalf of the artist but cannot make products for the art centre.

This is because the art centre cannot be both licensor (representing the artist) and licensee (using the copyright) due to conflict of interest.

Even if the art centre has agency rights, and wishes to manufacture products that reproduce the artist’s artwork, it will require a separate, specific copyright licence with the artist in order to do this.

Agent’s commission

The art centre often takes a commission on royalties from its dealings on behalf of the artist, indicating an agency rather than a licence.

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Third party product licensing

When developing products, art centres often make and sell their own printed items, such as postcards or greeting cards. However, third parties may also be engaged to manufacture products using an artist’s artwork, or wish to manufacture such products for their own purposes.

There are three main avenues for a manufacturer who wishes to secure a licence from an Indigenous artist:

Copyright Agency registration

If the art centre has registered its artists with the Copyright Agency, third parties can acquire a licence directly from the agency. This registration allows the Copyright Agency to sub-licence the artist’s copyright and pass on any collected royalties to the artist, minus a commission. For more details, you can visit the Copyright Agency’s website.

Art centre as agent

The art centre may act as the artist’s agent, negotiating and entering copyright licence agreements on behalf of the artist. The art centre has a responsibility to ensure that the artist agrees with the deal and understands the product being made.

The current Arts Law template membership agreement includes this agency clause, but if it does not, a separate Agency Agreement can be used. Arts Law also provides a sample third-party manufacturing licence, Copyright Licence Merchandise – Third Party.

Direct agreement with artist

Third parties can directly negotiate a copyright licence agreement with the artist. Often, the art centre assists in negotiating the terms, but the final licence is entered into by both the manufacturer and the artist.

All Arts Law agreements follow best practices, and the standards set by the Indigenous Art Code. These agreements do not specify royalty amounts, so for information on royalties, visit the Pricing and Payments page.

Overall, thorough documentation protects the artist’s rights, supports the licensing process, and helps maintain the artist and artwork’s value and reputation.

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More information about licensing

More detailed information about copyright and licensing is available from the Australian Copyright Council, Copyright Agency and the Arts Law Centre of Australia.