I have a scenario where I am not sure if this could be covered by the these licenses structure and the proposed implementation. But this is not my area at all so maybe I just need some more explanation 
JL: Hi, FreezeM - that’s great. We appreciate you jumping in with your questions.
What I want to do is separate the COM license from a ACE license. There are 3 roles in this scenario. First of all the artist (creator) of a piece of work. Second is a retailer that offers products (physical and digital) that are based on the artist’s work. The third is the NFT holder. These 3 roles could be held by 1 person or 2/3 different persons/accounts.
If I understand correctly:
The artist has the IP rights, so won’t need a license. The retailer would need the COM license. The NFT holder who receives royalties from the Retailer’s sales linked to the NFT they hold, I think this would be a ACE license.
Does this make sense and would it be covered by the proposed licensing structure?
JL: I’m assuming, in your scenario, that the Artist is the original content creator. Assuming that’s the case, the Artist owns the underlying, developed intellectual property (IP). So, the Artist, as the owner, is the one who grants the licenses, not the one who receives them.
Next, I’m assuming that the Artist is planning to tokenize that IP by minting it as one or more NFTs. The Artist then gets to choose which rights she wants to give purchasers of those NFTs - that’s what the NFT License Project is intended to help her with.
Let’s deal with your question about the Retailer first. In order to legally commercialize the Artist’s content associated with an NFT, the Retailer needs some sort of license do so. The Retailer can get such a license directly from the Artist independent of the NFTs (by virtue of some sort of license agreement), or by purchasing one of the Artist’s NFTs that’s offered under either a COM license (which gives full commercialization rights to the underlying content associated with the purchased NFT) or a MERCH license (which gives more limited commercialization rights to the underlying content associated with the purchased NFT). If the Artist offered certain NFTs under COM/MERCH licenses, anyone who owned the NFT would be permitted to commercialize the content associated with that NFT (thereby becoming a “Retailer”). Note that this right would restricted to the content associated with the NFT that the buyer actually owns. If the goal is for the Artist to enable the Retailer to commercialize a larger superset of the artists’s IP, then some sort of a formal license agreement is a better mechanism for doing that than having the retailer purchase individual NFTs.
Your question about the “NFT holder who receives royalties from the Retailer’s sales linked to the NFT they hold” is a bit confusing to me in this context, and makes me think that the license agreement approach is the way to go. The Artist, as the IP owner, is the one that will receive royalties from the sale of her NFTs (both royalties from the initial sale, and downstream royalties from secondary sales of those NFTs over time). The purchaser of the NFT does not receive royalties, as such - unless, I suppose, those purchasers receive an ACE license, with the additional benefit being a cut of the Retailer’s royalties. If that’s what you’re thinking about doing, then a formal IP license to all of the artist’s IP should happen first, and the Retailer should mint and release the NFTs for sale themselves (as opposed to the artist) - and those NFTs would be sold under an ACE license. You wouldn’t need a COM license at all, since that would be covered by the IP license agreement between the artist and the Retailer.
In short, it sounds like the project you’re thinking about needs a bit more fleshing out. Hope this helps.
