Missed Our Masterclass? Watch Contracts & Copyright: What to Know Before Selling Foreign Rights
This post features a transcript that has been auto-generated and lightly edited for readability. Some errors or minor inaccuracies may still be present.
Hello and welcome to the next installment of our masterclass with DropCap Marketplace.
My name is Lindsay Jones. I'm the CEO and one of the co-founders of DropCap.
Today we are going to be talking about contracts and copyright—what to know before selling foreign rights.
To give you a quick overview of what to expect, I’ll talk about:
Contracts and copyrights
Why it matters
Information to help you best protect your IP
How to make informed decisions before moving forward with foreign rights
I’ll talk for about twenty minutes, hopefully leaving some room for questions at the end.
If any questions come up as I'm going, please feel free to post them in the chat.
I know that we have some people tuning in who are already authors that work with DropCap,
and some of you may be totally new to us.
Everyone’s coming at it from a different perspective, and I’m happy to answer any and all questions that people have.
Why This Matters
First off, I want to talk about why understanding copyright, subsidiary rights, and contracts matters.
Especially if you're new to foreign rights or starting to think about it—this knowledge helps you move forward confidently.
We’ll also talk a little bit about how agents can help navigate the world of contracts when it comes to foreign rights licensing, or any other type of subsidiary licensing.
This is a barrier for many independent authors. Licensing sounds super intimidating, but it doesn't need to be. We're going to talk about that as well.
I have a cat. She likes to visit.
Copyright Basics
Understanding the difference between copyright and subsidiary rights is really important.
When you write your book, you automatically own the rights to it.
If you've already written your book, you might have registered the copyright with the Copyright Office.
This is not a requirement to own the rights to the book—you automatically own those as soon as you write it.
Copyright vs. Licensing
Registering your copyright is great for documentation.
If you ever have any legal challenges down the road, it adds a layer of protection.
It’s always a good idea to register it so everyone knows your work is your work.
But legally, it belongs to you because you're the person who wrote it.
As the copyright holder, you own and control the subsidiary rights to your book.
Subsidiary rights—also known as sub-rights—refer to all the formats and editions of your book beyond the original.
Oftentimes, an author will put out a paperback version of their book.
If you're being picked up by a traditional publisher, any other version of that book the publisher wants to put into the market can be negotiated.
Examples of subsidiary rights include:
Foreign rights (translation rights)
Audiobook licensing
Film and TV adaptation
Merchandising
Book club formats
You, as the copyright holder, decide what happens with those.
Are You Giving Up Copyright?
This does not mean that you’re giving up your copyright or ownership.
This is one of the most frequently asked questions we get from authors who are starting to consider licensing rights to their book:
“Does this mean I’m giving up my copyright? Am I selling it?”
No, you’re not.
When you license your sub rights, you're giving permission to someone else—for a limited period of time—to produce and sell a different version of your book.
For example, if that's international licensing,
you might say to a French publisher:
“I'm going to let you have the French licensing rights to my book for five years.”
After that point, those rights revert back to you.
It’s really important to understand that difference between your copyright—which you own—and the subsidiary rights, which you can license out as you're getting started.
You're Not Transferring Ownership
Sometimes authors are concerned that a rights contract means they’re transferring ownership of their book or the copyright.
That is not the case.
It’s very rare for an author to fully transfer control of the copyright.
Even in a traditional publishing deal, you're typically still negotiating what happens with your subsidiary rights.
You, as the author, still own the copyright.
You're giving the publisher permission to publish your book and profit from it—
but you are not giving away ownership of the work itself.
Contract Basics
Copyright ties into what you're going to be looking at in a contract if you're ever offered a rights licensing deal.
We see this happen when:
An author receives a contract from a foreign publisher
They don't have an agent
They’re trying to figure out what it means—
what they’re giving up, what they’re keeping, and how that affects control of their IP
It’s helpful to understand some of the basics of what you might see in a rights contract.
I’ll use foreign rights as an example—since that’s DropCap’s specialty—but this applies to all types of subsidiary rights.
Key Terms in a Foreign Rights Contract
1. Term (Length of License)
How long is the license valid?
You don’t want it to be indefinite. You want the rights to return to you at some point.
There’s always a timeline for how long the foreign publisher can control the specific rights covered by the contract.
Typically for us, we aim for five years.
I’ve also seen seven- and ten-year terms.
We prefer shorter contracts because it gives you the opportunity to renew—
and potentially renegotiate better terms, such as the advance or royalty rate, if the book performs well.
2. Language and Territory
Another key part of the contract is what language(s) and territory/territories the deal covers.
Language, Territory, and Format
Let’s say your book is being licensed to a German publisher.
That publisher may request worldwide rights to the German-language version.
This means they can translate the book into German and sell it anywhere in the world where German is spoken.
If that’s the case, you should expect to receive a higher advance—
because the reach and sales potential are greater.
Other publishers may request more limited rights.
For example, a Turkish publisher might license the Turkish rights only for Turkey.
That would likely come with a smaller advance.
You might also have a Spanish-language publisher in Mexico who licenses Spanish rights for Latin America,
and a completely separate Spanish publisher who licenses Spain-only rights.
These rights can be split many different ways.
The contract should clearly state:
Which language(s) are covered
Which territory or countries the book can be sold in
Which formats are included in the deal
Format-Specific Licensing
Often, foreign rights contracts start with print—paperback, hardcover, or both.
More and more, we’re seeing audiobook and ebook formats added on.
Each format added should increase the expected advance payment in the contract.
We're also seeing new types of licensing formats emerge, such as:
Digital subscription services
Educational distribution
Bundled content platforms
Your contract should specify exactly what the publisher is allowed to publish and in what format.
Payment Terms
This is, of course, one of the most important parts of the contract.
You’ll want to negotiate for the highest advance and royalty rate possible.
That said, payment expectations vary significantly based on the market.
Smaller international markets may offer smaller advances because they have:
Fewer readers
Lower sales potential
Less return on their investment
Market Maturity & Its Impact on Payment
More established markets—such as European publishing industries—tend to offer higher advances.
These markets have:
A long publishing history
Established readerships
A strong network of local authors
So when they license a book for translation,
they are willing to pay more—because they really want that specific book and author.
They may not have something similar in their local market, so the value is higher.
In contrast, less established or emerging markets, like India,
may license books more frequently but offer smaller advances.
All of this will influence what kind of advance and royalty rate you’re offered in your contract.
It helps to understand what’s considered fair or standard in different regions—and that’s where having an agent can really help.
Reporting & Payment Schedules
The contract should specify when reports and payments are due.
In most foreign rights contracts:
Sales reports are sent once per year, not quarterly or monthly.
This can feel like a big shift for indie authors who are used to near real-time sales data.
You might not see how your book performed until a year after the sales occurred.
But the contract should clearly state when you’ll receive these reports and payments.
Timeline for Publication
Foreign rights contracts usually involve longer timelines than authors may be used to.
We typically give publishers up to 18 months to publish the book.
This gives them time to:
Translate it with a qualified translator
Create a marketing plan
Align the release with their internal calendar and budget
If they have a specific release date in mind—like coordinating with a book fair or literary event—
they may plan that far in advance.
Timeline Considerations
Sometimes the publisher will want to release the book during a specific season—like fall.
There are many factors that go into deciding a release date, including:
Translation time
Marketing plan coordination
Internal publishing calendar
We allow up to 18 months for the publisher to complete their process,
though many publishers release the book sooner than that.
Regardless, your contract should specify the maximum timeline for publication.
Sales Thresholds & Reversion Clauses
What happens if sales expectations aren’t met?
Your contract should include reversion clauses that protect you as the author.
For example:
If a publisher doesn’t meet agreed-upon sales numbers
If they fail to publish the book within the defined time
Or if they stop actively selling the book
In those cases, the rights should revert back to you.
That way, you can relicense the rights or choose another path.
Common Pitfalls in Contracts
Let me preface this by saying:
Most of the time, when an author comes to me with a contract they’ve received from a foreign publisher,
they’re looking for help because the contract is full of jargon and they don’t want to be taken advantage of.
That’s a good instinct.
However, I don’t believe most foreign publishers are acting in bad faith.
They’re simply trying to get the best deal for themselves. That’s business.
That’s why having an agent is so helpful—they’re your advocate.
They:
Know the market norms
Understand what’s standard in specific regions
Can confidently push back and negotiate on your behalf
For example, an agent might see an offer and say:
“No, this publisher in [country] can afford a higher advance. That’s below standard.”
What to Watch for if You’re Reviewing a Contract Yourself
If you're reviewing a contract on your own, here are a few red flags to look out for:
One-Sided Financial Terms
Low advance or royalty rates that are well below industry standard.
At DropCap, we always advocate for contracts that include an escalator clause.
This means that the royalty rate increases as the book sells more.
For example:
If your royalty starts at 7% and your book sells over 10,000 copies,
the royalty rate might increase to 8% or even 9%.
This ensures that you, the author, share in the success of the book as it performs well for the publisher.
Red Flags: Reversion Terms
Another red flag to watch for: no clear rights reversion clause.
This means there’s no provision that spells out when rights return to you if the publisher:
Doesn’t meet agreed-upon sales thresholds
Fails to publish the book within a certain timeline
Puts the book out of print
If any of those things happen, you should be able to terminate the contract
and have your licensed rights return to you.
Surprisingly, this isn’t always standard in publishing contracts.
So make sure there’s a clearly defined reversion structure.
Also, make sure the contract includes a publishing deadline.
The publisher shouldn’t be allowed to sit on your book for years.
That’s time when someone else could have been actively selling it.
Translation & Adaptation Clauses
Your contract should also clearly define how translation or adaptation will be handled.
That includes:
A qualified, professional translator
A professional narrator if it’s an audiobook
And provisions about preserving the intent of the original work
Sometimes this includes language such as:
“No more than 5% of the content can be changed without approval”
or
“Any localization changes must preserve the author’s original intent”
This ensures cultural adaptation can happen (for example, with idioms or references)
but without fundamentally changing what you intended to say.
Maintaining Author Intent in Translation
It’s also worth noting:
Sometimes, foreign publishers will reach out directly to ask what a particular line or section means.
For example:
“Our translator doesn’t understand this idiom—can you explain what the author meant here?”
That’s a good thing. It means they’re trying to preserve your original intent.
Your contract should encourage this kind of communication and include a clause about maintaining the author’s intended meaning in the translation.
Marketing & Financial Protections
Marketing:
Push for specifics in the contract about the publisher’s marketing and promotional commitments.
The more detailed, the better.
Financial Protections:
The contract should clearly state when you’ll be paid
Watch out for any hidden fees
Avoid contracts where marketing costs are deducted from your royalties
You should receive your royalty percentage from the sales, not after expenses are deducted.
Also, contracts should state what happens if:
The publisher goes bankrupt
The publisher is acquired by another company
In cases of insolvency, rights should revert to you immediately.
Traditional Paths to Licensing
Traditionally, authors accessed rights licensing in one of two ways:
Signing with a rights agent
Receiving a direct offer from a foreign publisher
Working with an agent means personalized attention and strong negotiations—but it's highly competitive.
Agents are selective, often genre-specific, and may turn down self-published or niche works.
Receiving a direct offer (e.g., from a Chinese publisher who found your book on Amazon or social media) can be exciting:
You get a deal without having to query anyone
No agent commission
Pure upside
But it’s passive, hard to repeat, and lacks support. You may not know if the offer is fair—or even legitimate.
Why DropCap Marketplace Is Different
DropCap Marketplace offers a third path.
No need to query agents
No exclusive contracts
When an offer comes in, you're supported by a professional agent
Your book is discoverable by 2,700+ global rights buyers
Most of these are independent publishers actively looking for content from indie authors
We want authors to feel empowered to license their rights with confidence,
make informed decisions, and reach new readers—without giving up ownership or control.
Closing
That’s the end of today’s masterclass.
If you’re new to DropCap, you can use the coupon code “lunch” for 10% off a subscription—thank you for taking time during your lunch break.
If you’re already working with us, feel free to drop any questions in the comments.
Otherwise, I’ll share my email below—please don’t hesitate to reach out.
I’m always happy to answer questions about contracts, copyright, or foreign rights.
Thanks again for joining. I hope you enjoy the rest of your day.
