This study investigated into the legitimacy of franchising and licensing in global trade. The extent to which the technology is compatible with the licensee's line of business, the caliber of the licensee's production process, the efficiency of the licensee's distribution channels, and the parties' ability to effectively manage their interactions are the factors that determine whether licensing agreements in international trade are successful or unsuccessful, the study found. The study discovered that FDI has facilitated the implementation of international rules including TRIPS, WIPO, and EU. The expansion of the global market, which lowers the risks and costs associated with R&D, will have an impact on how licensing arrangements develop in the future. Compared to other business transactions, license agreements are more reliable.