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Example documentationExample: Acquisition Contract with Holdbacks

 

You want to represent license acquisition contracts in which you:

  • Acquire specific rights to an IP

  • Ensure that rights for the same IP with different dimensions are not simultaneously sold (or sold slightly earlier or later) whose exploitation could potentially compete with the exploitation of the IP with the rights that you acquired.

Representation in the License Acquisition Contract

You create a license acquisition contract to purchase the Canadian Pay TV broadcasting rights of an IP associated with a movie. You agree to a single royalty payment of $5000 with the licensor. Additionally, the licensor grants you a holdback in the Canadian Free TV market. The holdback start date is 3 months before the license start date for the Pay TV, and the holdback end date is the same as the license end date for Pay TV.

  1. When creating an item in the license acquisition contract, you can use item category IEM1 (IPM acquisition rights and royalties item), or a similar item category that you define (in SAP Customizing) to represent rights and royalties for fixed conditions.

    • Define the rights dimensions of the IP within this item.

    • Record the royalties amount of $5000 using condition type 17FO (fixed license fee OR), or a similar condition type that you define (in SAP Customizing).

  2. Create a holdback item as a sub-item to the rights and royalties item. When creating the holdback item in the license acquisition contract, you can use item category IEHB (IPM acquisition holdback), or a similar item category that you define (in SAP Customizing) to represent holdbacks.

    • Restrict the content of the right within this item according to the holdback rights.

    • Maintain the Pre duration of 3 months.

Result

The rights for the Pay TV market in Canada have been acquired and a holdback for the Free TV market in Canada was granted.