Intellectual Property

Responding when a joint research partner’s consent to licensing a jointly owned patent cannot be obtained

When a company jointly owns a patent covering joint research results, the consent of the other co-owners is required to license that patent to a third party. If the joint research partner's consent cannot be obtained even though out-licensing negotiations are progressing, conclusion of the agreement itself is held up.

Three matters need to be checked, in order. First, whether the proposed activity requires the consent of the other co-owners in the first place. Second, whether consent has already been given. Third, if no consent exists, whether there is a contractual basis for seeking the other party's consent or participation in discussions. The reasons why the co-owner is refusing consent and the interests behind those reasons also need to be understood. Simply checking the provisions of the Patent Act does not resolve this situation.

This article sets out what biotech ventures and pharmaceutical companies seeking to pursue out-licensing should check and how to structure negotiations.

Reviewed by Keishi Yoshikawa, Attorney at Law and Patent Attorney (Dai-Ichi Tokyo Bar Association)

Last updated: September 27, 2026

What to check when consent cannot be obtained

The patent numbers, co-owners, ownership shares, and prosecution history
All relevant agreements, including joint research agreements, joint patent application agreements, and agreements on transfers of co-ownership shares
Whether the agreements contain provisions on licensing to third parties, including consent requirements, circumstances in which consent may be refused, and procedures for discussions
The reasons the co-owner has given for refusing consent
The proposed license terms, including the prospective licensee, subject matter, territory, duration, consideration, and whether the license is exclusive or non-exclusive
The negotiation deadline and conditions precedent in the agreement with the prospective licensee

How we can helpReview of the co-ownership of the relevant patent and related agreements / Checking for blanket consent and past dealings that may amount to implied consent / Review of contractual provisions, distinguishing between a duty to consent and a duty to participate in discussions / Classification of the reasons for refusal and review of terms that may be adjusted / Review of conditions precedent and deadlines in the agreement with the prospective licensee / Negotiations with co-owners and preparation of agreements

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Contents

1 The general rules under the law
2 Three stages of review
3 Checking the contractual basis
4 Classifying the reasons for refusal
5 Reviewing the arrangements with the prospective licensee
6 Negotiations and further options
How we can assist
Key legislation and official sources
Frequently asked questions

1 The general rules under the law

The Patent Act distinguishes between the following three matters where a patent right is jointly owned.

First, a co-owner must not transfer its share or create a pledge over that share without the consent of the other co-owners.

Second, each co-owner may practice the patented invention without the consent of the other co-owners, unless the contract provides otherwise.

Third, a co-owner must not establish an exclusive license (senyo jisshiken) or grant a non-exclusive license (tsujo jisshiken) to a third party under the patent without the consent of the other co-owners.

A company's own practice of the invention is therefore treated differently from licensing a third party. However, describing an arrangement as "a license confined to the company's own share" or "a license that is not exclusive" does not remove the consent requirement in the third situation. The other co-owners' consent is required even for a non-exclusive license (tsujo jisshiken) granted without contractual exclusivity.

Nor can practice of the invention by a subsidiary or a prospective licensee that is a separate legal entity automatically be treated as the co-owner's own practice. At the same time, the fact that it is a separate legal entity does not, by itself, determine that the activity is not the co-owner's own practice.

Where manufacturing is outsourced, whether it can be treated as the co-owner's own practice of the invention is assessed according to the actual arrangements. The matters to check are the contractual allocation of roles, the existence and extent of direction and supervision over manufacturing and quality control, the recipients of the products, and who bears the costs and receives the profits. Formally arranging these matters does not necessarily result in the activity being treated as the co-owner's own practice. A judgment addressing this issue is discussed in the next section.

These rules are a starting point, not a conclusion. How to proceed when a co-owner does not consent needs to be examined through the three stages set out in the next section.

2 Three stages of review

Dividing the review into the following three stages helps organize the issues. Changing the order leads to discussions at cross-purposes.

The first step is to check whether the proposed activity constitutes licensing to a third party that requires the other co-owners' consent. Different issues arise depending on whether the invention is to be practiced by the company itself, through a subsidiary, or by the prospective licensee.

The second step is to check whether consent already exists. A joint research agreement may contain advance blanket consent for licenses within a specified scope. The parties' dealings to date may also amount to implied consent. The absence of an express clause is not the same as the absence of any consent.

The third step, where consent does not exist, is to check whether the other party has a contractual duty to consent or participate in discussions. This involves checking whether contractual duties to consent or participate in discussions exist and what those duties require.

The important distinction here is between whether consent exists and whether there is a duty to give consent. A duty to consent also differs from a duty to participate in discussions. These distinctions affect the conclusions reached when assessing the claims discussed below.

A judgment that addressed the first and second stages separately

In a case in which one co-owner had a third party manufacture and deliver products, the court held that the manufacturing and delivery could not be equated with the co-owner's own practice of the invention. It nevertheless found, in light of the parties' dealings to date, that the other co-owner had implicitly consented to licensing the third party (Tokyo District Court judgment of March 26, 2014, Case No. 2011 (Wa) 3292).

However, the court considered specific circumstances in that case, including the purpose of the transfer of a co-ownership share, proposals regarding technical specifications, and participation in meetings. Merely knowing about the activities and not objecting does not invariably amount to implied consent. Nor did the judgment establish a general rule on the relative priority of express agreement and implied consent.

3 Checking the contractual basis

Contract documents to review

The documents to review include joint research agreements, joint patent application agreements, memoranda, minutes, and correspondence concerning patent applications and registration. If there are clauses on consent, their wording needs to be read carefully.

The points to check are as follows.

Whether advance blanket consent has been given for licensing to third parties, and whether individual consent is required
Whether the circumstances in which consent may be refused are limited, including whether there is a provision stating that consent must not be withheld without reasonable grounds
Whether the agreement only requires participation in discussions, rather than consent itself
Whether there are provisions on sharing the consideration
Whether there are restrictions on licensing to competitors

These clauses differ in nature. What can be required depends on the type of clause.

Contractual provision	What can be required of the other party	What to check in negotiations
Advance blanket consent covers licenses within a specified scope	There is no need to seek consent again	Whether the proposed license falls within that scope
The agreement only requires individual consent	It is for the other party to decide whether to consent	The terms on which the other party can consent
The agreement provides that consent must not be withheld without reasonable grounds	The other party is required to consent unless there are reasonable grounds for refusal	Whether the reasons given constitute reasonable grounds
The agreement only requires discussions in good faith	The other party is required to participate in discussions	Whether an opportunity for discussions has been arranged and the necessary information has been provided
There is no express clause on licensing to third parties	It is difficult to derive an obligation directly from the contract	Whether other agreements or memoranda contain relevant provisions, and whether prior exchanges have established blanket or implied consent

The applicable row in this table determines the next step. Time is lost if negotiations are conducted to seek individual consent even though blanket consent exists, or if a demand for consent itself is pursued when there is only a duty to participate in discussions.

Where there is no specific provision

If there is no specific provision on consent, it is difficult to derive a contractual basis directly for requiring the other party to consent. However, the absence of an express clause differs from the absence of any agreement. It is also necessary to check whether the parties' prior exchanges leave room to conclude that an understanding had been reached concerning licenses within a specified scope.

If no agreement providing such a basis can be found after that review, the main approach is to reach agreement through negotiations. This involves identifying terms on which the other party can consent, taking into account the purpose of the joint research, the history of the matter, and the interests of both parties.

4 Classifying the reasons for refusal

There are several categories of reasons why consent cannot be obtained. The following are examples of reasons for refusal to examine, not an exhaustive list of legally permissible reasons. The appropriate response depends on the reason.

Competition concerns—This is where consent is refused because the prospective licensee is a competitor of the co-owner. It may be possible to address the concern by limiting the subject matter, territory, or field of use of the license.

Sharing the consideration—This is where agreement has not been reached on sharing the licensing revenue. Discussions need to cover the allocation method, timing, and audit provisions.

The co-owner's plans to practice the invention—This is where the co-owner plans to practice the invention itself and considers that licensing a third party would interfere with those plans. Possible adjustments include avoiding exclusivity or separating territories or fields of use. These adjustments seek terms that make consent easier to obtain; making the license non-exclusive does not remove the consent requirement.

Insufficient procedures or explanation—The license terms may not have been adequately explained, or internal approval procedures may not have been completed. Providing information and allowing time may resolve the issue in such cases.

5 Reviewing the arrangements with the prospective licensee

The agreement with the prospective licensee may make the co-owner's consent a condition precedent to its effectiveness. In that case, the agreement does not take effect until consent is obtained, so the deadline needs to be managed.

Restructuring the agreement may also be considered in light of the possibility that consent cannot be obtained. Possible approaches include limiting the scope to patents based on applications filed solely by the company, or adding the jointly owned patent once a separate agreement has been reached. Both approaches require discussions with the prospective licensee, so the company needs to decide whether to share the situation at an early stage.

If the agreement is being held up because the prospective licensee has identified a third party's patent, the issue is different. In that situation, the content of the identified patent, the proposed activities, and the contractual terms need to be reviewed separately from the co-owner consent issue.

6 Negotiations and further options

Negotiations focus on proposing terms that address the reasons for refusal. Possible proposals include limiting the scope of the license, providing the co-owner with certain rights as well, and clarifying how the consideration is to be shared. The proposed licensing terms should be set out alongside the corresponding requests to the other party.

Examples of possible responses are as follows.

Reason for refusal	Examples of terms to propose	What to request from the other party
Licensing to a competitor	Restrictions on fields of use, territories, and duration; exclusion of areas of competition; prohibition of sublicensing	Consent within the restricted scope
No agreement on sharing the consideration	A draft agreement specifying the allocation percentages, payment timing, and reporting and audit methods	Agreement on the allocation and consent on that basis
Interference with the co-owner's own practice of the invention	A non-exclusive license and preservation of scope for the co-owner's own practice	Consent on that basis
Insufficient explanation or internal procedures	Materials setting out the license terms and a revised response deadline	Arrangements for discussions and a response by the deadline

When proposing terms, the company should state what it is asking the other party to do: give consent itself, participate in discussions, or respond to the proposed terms. When the contractual duties and their performance are later assessed, the history of repeated exchanges that left this unclear may not adequately show what was requested and how the other party responded.

If negotiations do not result in agreement, options may include transferring or acquiring a co-ownership share or ending the co-ownership arrangement. However, transferring a share also requires the consent of the other co-owners, so this too is a matter for negotiation.

Seeking performance of a contractual obligation is another possibility. As a general rule, the party to whom a contractual obligation is owed may demand performance. Before considering whether such a claim can be made, however, the nature and scope of the other party's obligation need to be determined.

For example, what can be required differs between a provision stating that "consent must not be withheld without reasonable grounds" and a provision that only requires the parties to "discuss in good faith." The former may provide a basis for requiring consent itself, whereas the latter requires participation in discussions. The Patent Act provision itself does not require reasonable grounds for refusing consent, so this depends on the contractual terms. What constitutes reasonable grounds is also assessed in light of the contract's wording and the history of the matter.

Where a specific duty to consent is established, the next step is to seek performance of that duty. As a general rule, when a judgment ordering a party to make a manifestation of intention becomes final and binding, that manifestation of intention is deemed to have been made. The issue to examine is therefore what obligation can be established from the contract and the history of the matter.

Whether a duty to participate in discussions has been fulfilled likewise does not depend on the clause's wording alone. The course of the discussions is examined, including what was explained to the other party, what proposals were made, and what information was provided. In a case concerning discussions about the ownership and transfer of intellectual property rights under a contract for commissioned research, the court found no breach of the duty to participate in discussions, taking into account reports on research progress, explanations of the prospects for obtaining patent protection, and the circumstances in which the party commissioning the research understood that information and decided not to seek protection.

Whether seeking a resolution through litigation is appropriate from a business perspective needs to be decided separately from these assessments. While out-licensing negotiations are ongoing, identifying terms that the other party can accept may be faster than working through whether a claim can be brought.

How we can assist

We review the co-ownership arrangements for the relevant patent and all related agreements.
We check whether blanket consent exists and whether the parties' past dealings may amount to implied consent.
We review contractual provisions on consent, distinguishing between a duty to consent and a duty to participate in discussions.
We review the reasons for refusal by category and the terms that may be adjusted.
We check the conditions precedent and deadlines in the agreement with the prospective licensee and consider changes to its structure.
We assist with negotiations with co-owners and the preparation of agreements.
We also consider the transfer or acquisition of co-ownership shares and the dissolution of co-ownership.

Key legislation and official sources

English translations of legislation are provided for reference. The Japanese texts are authoritative.

Article topic	Legislation or official source	Source type and English version reviewed
Co-owners' own practice of an invention, licensing to third parties, and the transfer or pledge of co-ownership shares	Patent Act— Japanese text on e-Gov	Legislation. English translation (earlier version). The translation's version labels differ (Act No. 48 of 2022 in the Japanese label; Act No. 48 of 2024 in the English label).
Distinguishing a co-owner's own practice of an invention from implied consent to third-party licensing	Tokyo District Court, judgment of March 26, 2014, 2011 (Wa) No. 3292	Court judgment.
Seeking performance of contractual obligations	Civil Code— Japanese text on e-Gov	Legislation. English translation (earlier version). The translation identifies its last version as Act No. 37 of 2021.
Effect of a final and binding judgment ordering a manifestation of intention	Civil Enforcement Act— Japanese text on e-Gov	Legislation. English translation (earlier version). The translation identifies its last version as Act No. 2 of 2019.

Legal information reviewed: September 27, 2026

Frequently asked questions

Q1 Is it impossible to license the patent to a third party without the co-owner's consent?

The Patent Act provides that a co-owner must not establish an exclusive license or grant a non-exclusive license to a third party under the patent without the consent of the other co-owners. This applies even if the license is granted on a non-exclusive basis. Under the same Act, however, each co-owner may practice the invention without the other co-owners' consent unless the contract provides otherwise.

However, an agreement may already contain advance blanket consent, or the parties' past dealings may amount to implied consent. The first step is to check whether consent already exists.

Q2 A co-owner is refusing consent without giving a reason. Can the co-owner be compelled to consent?

This depends on whether the agreement contains a provision such as one stating that "consent must not be withheld without reasonable grounds." Even if it does, what constitutes reasonable grounds needs to be assessed in light of the contract's wording and the history of the matter.

The relevant provision of the Patent Act does not itself require reasonable grounds for refusing consent. Contractual restrictions on the grounds for refusal are assessed by checking the contractual terms and the history of the matter. Accordingly, if there is no contractual provision, it is difficult to derive a duty to consent directly from the statutory rule. If the agreement only provides for discussions in good faith, what can be required is participation in discussions, rather than consent itself.

Where a specific contractual duty to consent is established, the next step is to seek performance of that duty. The first matter to check is what obligation can be established from the contract and the history of the matter.

Q3 Can a company transfer only its own share to the prospective licensee?

The Patent Act also requires the other co-owners' consent for a transfer of a share. This option therefore also presupposes negotiations with the co-owners.

Q4 A co-owner is concerned about licensing to a competitor. What adjustments can be made?

Possible adjustments include limiting the subject matter, territory, field of use, or duration of the license; avoiding exclusivity; or reserving certain rights for the co-owner. The starting point is to identify specifically which terms the co-owner can accept. These adjustments seek terms that make consent easier to obtain; making the license non-exclusive does not remove the consent requirement.

Q5 The joint research agreement only says that the parties are to "discuss in good faith." What can be required?

Participation in discussions can be required. Such a provision does not normally provide a basis for requiring consent itself. Whether the duty to participate in discussions has been fulfilled does not depend on the wording alone; it is assessed in light of what was explained to the other party, what proposals were made, and what information was provided. It is therefore useful for the company to keep a record of having explained the proposed license in concrete terms, offered terms addressing the other party's concerns, and set a response deadline.

Q6 The agreement with the prospective licensee sets a deadline. How should the company proceed?

The deadline and the prospects of obtaining consent should be monitored together. If consent may not be obtained in time, the company may discuss restructuring the agreement with the prospective licensee, for example by limiting it to patents based on applications filed solely by the company or adding the jointly owned patent once a separate agreement has been reached. When to share the situation is a matter of judgment in the negotiations.

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Making an inquiry

You can consult us about the need for consent, whether consent already exists, the scope of contractual obligations, and how to structure negotiations when a joint research partner's consent to licensing a jointly owned patent cannot be obtained. If you bring joint research and joint patent application agreements, along with documents setting out the proposed license terms, we can begin reviewing the specifics at the initial consultation.