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Technology Transfer Arrangement
Defined
Technology
Transfer Registration
The
signing of Republic Act 8293,
otherwise known as the Intellectual Property (IP) Code, on June 6, 1997
liberalizes regulations on technology transfer registration particularly
the rate of fees or royalties and strengthens intellectual property rights
protection in the Philippines. Voluntary
Licensing has been provided by the Code.
Recordal with the IPO of agreements that involve transmission of
rights is necessary. However,
registration is no longer required where the agreement is in conformity of
the requirements of the law under Sections 87 and 88.
Voluntary Licensing
Difference
between TTR Policies and Chapter IX of the IP Code on Voluntary Licensing:
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Coverage
of the Law
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TTR
Policy
(Old
Law)
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Chapter
IX of the IP Code on Voluntary Licensing
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Parties
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Only
those between domestic companies and foreign or foreign-owned
companies
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All
technology transfer arrangements
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Subject
Matter
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Industrial
Property
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Intellectual
Property
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Registration
Requirements
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Mandatory
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Not required except in
the following cases:
1.
Requests for exemption from Sections 87 and 88 of the IP
Code;
2.
Recordal of Trademark
License arrangements with the IPO;
and
3.
Other legal purposes
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Focus
of Evaluation
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Restrictive
Business Processes, Royalty Fees
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Anti-competition
and trade
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Policy
on Royalty
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Requires
extensive evaluation of fees if beyond 5% of net sales
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Liberalized
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Effects
of Non-registration
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Unenforceable
on third parties
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Unenforceable
(Sec. 92 of the IP Code)
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Technology Transfer Arrangement refers to contracts
or agreements, including renewals thereof, involving the transfer of
systematic knowledge for the manufacture of a product, the application of
a process, or rendering of a service including management contracts; and
the transfer, assignment or licensing of all forms of intellectual
property rights, including licensing of computer software except computer
software developed for mass market.
Section 87 of the IP Code covers the prohibited clauses which are
adverse to competition and trade.
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Prohibited Clauses
(Section 87, IP Code)
1. Those which impose upon the licensee the obligation to acquire from
a specific source capital goods, intermediate products, raw materials, and
other technologies, or of permanently employing personnel indicated by the
licensor;
2. Those pursuant to which the licensee reserves the right to fix the
sale or resale prices of the products manufactured on the basis of the
license;
3. Those that contain restrictions regarding the volume and structure
of production;
4. Those that prohibit the use of competitive technologies in a
non-exclusive technology transfer arrangement;
5. Those that establish full or partial purchase option in favor of
the licensor;
6. Those that obligate the licensee to transfer for free to the
licensor the inventions or improvements that may be obtained through the
use of the licensed technology;
7. Those that require payment of royalties to the owners of patents
for patents which are not used;
8. Those that prohibit the licensee to export the licensed product
unless justified for the protection of the legitimate interest of the
licensor such as exports to countries where exclusive licenses to
manufacture and/or distribute the licensed product(s) have already been
granted;
9. Those which restrict the use of the technology supplied after the
expiration of the technology transfer arrangement, except in cases of
early termination of the technology transfer arrangement due to reason(s)
attributable to the licensee;
10.
Those which require payments for patents and other industrial
property rights after their expiration or termination of the technology
transfer arrangement;
11. Those which require that the technology recipient shall not contest
the validity of any of the patents of the technology supplier;
12.
Those which restrict the research and development activities of the
licensee designed to absorb and adapt the transferred technology to local
conditions or to initiate research and development programs in connection
with new products, processes or equipment;
13. Those which prevent the licensee from adapting the imported
technology to local conditions, or introducing innovation to it, as long
as it does not impair the standards prescribed by the licensor; and
14. Those which exempt the licensor from liability for non-fulfillment
of his responsibilities under the technology transfer arrangement and/or
liability arising from third party suits brought about by the use of the
licensed product or the licensed technology.
On
the other hand, Section 88 of the IP Code contains provisions which need
to be included in voluntary license agreement as follows:
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Mandatory Provisions
(Section 88, IP Code)
1. That the laws of the Philippines shall govern the interpretation of
the agreement and in the event of litigation, the venue shall be the
proper court in the place where the licensee has its principal office;
2. Continued access to improvements in techniques and processes
related to the technology shall be made available during the period of the
technology transfer arrangement;
3. In the event the technology transfer arrangement shall provide for
arbitration, the Procedure of Arbitration of the Arbitration Law of the
Philippines or the Arbitration Law of the United Nations Commission on
International Trade Law (UNCITRAL) or the Rules of Conciliation and
Arbitration of the International Chamber of Commerce shall apply and the
venue of arbitration shall be the Philippines or any neutral country; and
4.
The Philippine taxes on all payments relating to the technology
transfer arrangement shall be borne by the licensor.
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Types
of Filing with DITTB
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Requirements
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Preliminary
Review or Pre-Clearance
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Exemption
from Application of Sections 87 and 88 of the IP Code
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Compliance
and Approval for Legal Purposes
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Recordal
of Trademark License Agreement
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Letter
of Request
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Addressed
to the DITTB Director
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Request should be
under oath and addressed to the DITTB Director
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Request should be
under oath and addressed to the DITTB Director
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Addressed to the
DITTB Director
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Application Form
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N/A
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1 copy, duly
filled-up and notarized
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1 copy, duly
filled-up and notarized
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1 copy, duly
filled-up and notarized
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Sworn
statement that the Agreement is not subject of any judicial,
administrative or other proceeding
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N/A
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1
original copy
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1 original copy
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N/A
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Agreement
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2
copies (draft)
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2
copies executed/notarized or draft
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2 copies
original
executed/notarized
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2 copies
original
executed/notarized
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Justification under
oath
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N/A
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1 original copy
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N/A
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N/A
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Filing Fee
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Php
1,500.00 plus 1% legal research fund
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Php 1,500.00 plus 1%
legal research fund
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Php 1,500.00 plus 1%
legal research fund
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Php 1,500.00 plus 1%
legal research fund
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Registration Fee
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N/A
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Php 1,500.00 plus 1%
legal research fund
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Php 1,500.00 plus 1%
legal research fund
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N/A
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List
of Trademarks(s) and Patent(s) Registered with BPTTT/ IPO
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N/A
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List of TM(s) and/or
Patent(s) covered by the Agreement (with corresponding BPTTT/IPO
registration number)
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N/A
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N/A
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BOI
and/or PEZA Certificate of Registration, if applicable
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N/A
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1
copy (certified true copy)
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1
copy (certified true copy)
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1
copy (certified true copy)
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Others
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N/A
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As may be required by
the DITTB
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As may be required by
the DITTB
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As may be required by
the DITTB
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