---
title: "License Agreement Drafting"
url: "https://legal.ge/en/service/intellectual-property-law-en/license-agreement-drafting-en"
field: "Intellectual Property Law"
description: "License agreement drafting under Articles 319, 325, 344 and 418 of the Civil Code: freedom, fairness, surprise filter, penalty. Legal.ge."
reviewed: "2026-07-09"
updated: "2026-11-07"
publisher: "legal.ge"
---

# License Agreement Drafting

> Source: legal.ge, https://legal.ge/en/service/intellectual-property-law-en/license-agreement-drafting-en

## Drafting a License Agreement with the Civil Code's Machinery

A license agreement — over copyright, a trademark or technology — rests on the machinery of the Civil Code, and it is that machinery which decides whether the drafted document will stand: the freedom of contract for shaping an atypical licence (Article 319); the fairness gap-filler for unwritten terms (Article 325); the surprise-clause filter for standard terms (Article 344); and the enforceable penalty architecture (Article 418). This page explains these mechanisms as a licence document uses them.

## Freedom of Contract — Article 319

Subjects of private law may, within the limits of the law, freely conclude contracts and determine their content; they may conclude contracts not provided by law provided these do not contradict it — hence the possibility of non-standard licence structures. There are boundaries: where one party holds a dominant position on the market, it bears an obligation to contract and may not groundlessly offer the counterparty unequal terms; and persons acquiring or using property or services for non-entrepreneurial purposes or vital needs may not be unreasonably refused a contract where the other party acts within its entrepreneurial activity. For the licensor this means: freedom is broad, but market power has a limit on its use.

## The Fairness Gap-Filler — Article 325

Where the conditions of performance must be determined by one party to the contract or by a third person, in case of doubt it is presumed that the determination is to be made on the basis of fairness. And where a party does not consider the terms fair, or their determination is delayed, the decision is taken by the court. In licences this norm works often: a royalty formula depending on one party's data, or technical specifications to be set by a third person, are read in case of doubt against the standard of fairness. The determiner's authority must therefore be written into the contract precisely.

## The Surprise-Clause Filter — Article 344

Those clauses of the standard terms of a contract which are so unusual in form that the other party could not have reckoned with them do not become a constituent part of the contract. In licensing practice this filter addresses templates: an unusual clause buried in pre-formulated terms — say, an unusual territorial restriction or a unilateral right of amendment — does not enter the contract where the other party could not have expected it. When using a standard form, unusual conditions must therefore be set out with particular prominence.

The full text is available on legal.ge after signing in: https://legal.ge/en/service/intellectual-property-law-en/license-agreement-drafting-en

### Must the penalty be written?

Yes — an agreement on a penalty requires written form.

### May a dominant party refuse to contract?

A market-dominant party bears an obligation to contract and may not groundlessly impose unequal terms.

### Who decides the fairness of a term?

Fairness is presumed in case of doubt; on dispute or delay — the court.

### What is an atypical contract?

One not provided by law but not contradicting it — it may be concluded with free content.