Allowing another firm, for payment, to make use of a patent or trademark. This is a method of profiting from a patent without the need to undertake investment on the scale necessary to exploit an innovatory idea. The advantage of licensing over sale of the patent is that is allows the inventor to retain ownership. Licensing is also used by firms to shift profit to low-tax jurisdictions by requiring subsidiaries in high-tax jurisdictions to pay a licence fee, and locating the subsidiary receiving the fee in a low-tax jurisdiction. See also Base Erosion and Profit Shifting (BEPS); tax avoidance.