A company is trying to enter a market where there are strategic barriers preventing it from entering. The company decides to sell the right to use its intellectual property to locally operated companies in exchange for a fee. What is the term used for this arrangement?

Franchising involves a business model where a franchisor grants a franchisee the rights to operate a business under its brand and system. Unlike licensing, franchising typically includes comprehensive operational support and a structured business format, which is not the focus of the arrangement described in the question.

A subsidiary is a company that is controlled by another company, typically referred to as the parent company. Establishing a subsidiary involves direct investment and operational management in the target market, which differs from the more passive arrangement of licensing intellectual property rights.

A joint venture is a business agreement where two or more parties collaborate and share resources to achieve a specific goal, often creating a new entity. This arrangement requires a high level of cooperation and shared management, which is distinct from licensing, where the rights to intellectual property are granted without forming a new business entity.