What term describes the agreement to share a brand for commercial use in a defined market?

The term that describes the agreement to share a brand for commercial use in a defined market is licensing agreement. This process allows one party, the licensee, to use the intellectual property or brand of another party, the licensor, under specific conditions. Licensing agreements often outline the scope of usage, including the products or services that can bear the brand, the geographical areas in which the brand can be used, and the duration of the agreement.

In this context, the licensing agreement enables businesses to expand their market presence and capitalize on established brand reputations without the need for significant investment in brand development. It provides a structured approach to collaboration while protecting the rights of the brand owner. This term specifically reflects the formal nature of the arrangement and the legal authorization required to utilize the brand, which is essential in business operations involving shared branding strategies.