Page 173 - Accountancy_F5

The agreement will also state the parties use the work. Any other party wishing to
involved, the rights granted, and the period reprint, copy, display, or otherwise use the
of use of the licensed property. copyrighted work must obtain authorisation

Types of royalties from the creator. Royalties are payments
Royalty payments may cover many different made to the copyright owner by another
FOR ONLINE READING ONLY
types of property. Some of the more common individual or firm for the right to use the
types of royalties are as follows: copyrighted material. These payments,
known as copyright royalties, are common
Patent royalties: Usually innovators in various industries. For example, book
or creators patent their products. Patent authors receive royalties from publishers
royalties are paid to people or firms that (known as book royalties), and owners
LANGUAGE EDITING
have innovated or created certain products. of copyrighted music receive royalties
Examples of products that may require whenever their music or song is played by
patenting are new electronic devices, new a radio station, used in a movie, or utilised
type of engines, and new drugs. Then, if by a third party (known as performance
a third party wants to use such product royalties). These examples illustrate the
of patent, must enter into a contractual practical application of copyright royalties
agreement that will require the payment in different contexts.
of royalties to the patent owner. In this
way, royalty acts as a compensation to the Franchise royalties: A franchise is a
innovator for the intellectual property. license given by a business owner to a third
party with a view of providing its brand,
Mineral royalties: These are royalties operational model and required support
paid by mineral extractors to land owners. to use and run a similar business for a fee
Mineral royalties encompass a wide range and/or some share of the income generated.
of natural resources, including: oil, gas, Franchise aims at expanding the business
coal, metal ores, non-metallic, gem and and be able to distribute goods and services
precious stones, industrial minerals and to areas where the original owner is unable
rare earth elements. The party that wants to reach. The original owner is known as the
to extract the minerals will often pay the franchisor, while the user is the franchisee.
property owner an amount based on either The franchise royalty is an ongoing fee paid
revenue or units, such as barrels of oil or by the franchisee to the franchisor after
tons of coal. entering into a franchise contract. Majority of
Copyright royalties: A copyright is the franchise companies operating in Tanzania
exclusive right granted to the creator of an currently, are food and drinks chains. For
artistic work upon its creation. Copyright example, the company producing Coca-
protection extends to music, paintings, Cola (Coca Cola Kwanza Ltd.) franchised
screen plays, films, etc. This exclusive right its operation to Mbeya and Zanzibar.
provides the artist with the sole authority to

Student’s Book Form Five
160

23/06/2024 17:35
ACCOUNTANCY_DUMMY_23 JUNE.indd 160
ACCOUNTANCY_DUMMY_23 JUNE.indd 160 23/06/2024 17:35