By Dr. Annemarie Bloß and Alexa Mattfeld (Hamburg) As a consequence of the M2Trade and Take Five decisions of the German Federal Court of Justice (BGH), sublicenses continue to exist once the main license is terminated. This has a severe impact for both licensor and licensee in the fashion sector. LICENSING IN THE FASHION INDUSTRY The advantages of licensing in the fashion industry are numerous, including risk and cost reduction, increase of market penetration, market profile and revenues. Licensing is commonly used to expand fashion companies and generate additional income beyond the company´s own capacity, geographical reach and production strength. By means of brand extension licensing, for example, fashion designers license their trademark for use on branded eyewear (e.g., Gucci, Prada, Paul Smith) or perfume (e.g., Polo Ralph Lauren under license to L´Oréal). Co-branding, character licensing as well as seals of quality or…
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