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What is the source of the royalty from FORco to HOTco

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Point 1: HOTco, a domestic corporation, invents a control panel to make residential furnaces heat up faster. HOTco sells these control panels exclusively in the United States. HOTco does not wish to operate abroad.

Point 2: Therefore, HOTco licenses its control panel know-how to FORco, an unrelated foreign corporation, for commercial exploitation abroad. Under this license, FORco manufactures control panels in Belgium for sale throughout Europe. FORco pays HOTco a royalty on each foreign sale made.

Question 1: What is the source of the royalty from FORco to HOTco?

Reference no: EM132476506

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