RULE
6 PETITION
FOR
COMPULSORY LICENSING
Section 1. Patents
subject to proceedings for compulsory licensing. Invention
patents,
industrial design registration and utility model registration are all
subject
to proceedings for compulsory licensing.
Section 2. Who
may file petition for compulsory licensing; time for filing the
petition.
Upon the payment of the required fee, any person may file a
petition
for compulsory licensing at any time after the grant of the patent or
registration
of the industrial design or utility model. However, if the
petition
is based on the ground that the patented invention is not being worked
in the Philippines on a commercial scale, although capable of being
worked,
without any satisfactory reason, the petition may be filed at any time
after the expiration of a period of four (4) years from the date of
filing
of the application or three (3) years from the date of the patent
whichever
period expires last.
Section 3.
Grounds
for compulsory licensing. The Director may grant
a license to exploit a patented invention, even without the agreement
of
the patent owner, in favor of any person who has shown his capability
to
exploit the invention, under any of the following circumstances:
(a) National
emergency
or other circumstances of extreme urgency;
(b) Where
the public
interest, in particular, national security, nutrition, health or the
development
of other vital sectors of the national economy as determined by the
appropriate
agency of the Government, so requires; or
(c)
Where a
judicial or administrative body has determined that the manner of
exploitation
by the owner of the patent or his licensee is anti-competitive; or
(d) In
case of public
non-commercial use of the patent by the patentee, without satisfactory
reason;
(e) If
the patented
invention is not being worked in the Philippines on a commercial scale,
although capable of being worked, without satisfactory reason;
Provided,
that the importation of the patented article shall constitute working
or
using the patent.
Section 4. Requirement
to obtain a license on reasonable commercial terms. The license
will
only be granted after the petitioner has made efforts to obtain
authorization
from the patent owner on reasonable commercial terms and conditions but
such efforts have not been successful within a reasonable period of
time.
Section 5. When
a petition for compulsory licensing may be granted even without efforts
to obtain authorization from the patent owner. The
requirement
under the preceding section shall not apply in the following
cases:
(a) Where
the petition
for compulsory license seeks to remedy a practice determined after
judicial
or administrative process to be anti-competitive;
(b) In
situations
of national emergency or other circumstances of extreme urgency;
(c) In
cases of public
non-commercial use.
Section 6. Notice
to the right holder. (a) In situations of national emergency
or other circumstances of extreme urgency, the right holder shall be
notified
as soon as reasonably practicable.
(b) In the case of
public non-commercial use, where the government or contractor, without
making a patent search, knows or has demonstrable grounds to know that
a valid patent is or will be used by or for the government, the right
holder
shall be informed promptly.
Section 7.
Compulsory
licensing of patents involving semi-conductor technology. In
the case of compulsory licensing of patents involving semi-conductor
technology,
the license may only be granted in case of public non-commercial use or
to remedy a practice determined after judicial or administrative
process
to be anti-competitive.
Section 8. Compulsory
license based on interdependence of patents. If the
invention
protected by a patent, hereafter referred to as the “second patent”,
within
the country cannot be worked without infringing another patent,
hereafter
referred to as the “first patent”, granted on a prior application or
benefiting
from an earlier priority, a compulsory license may be granted to the
owner
of the second patent to the extent necessary for the working of his
invention,
subject to the following conditions:
(a) The
invention
claimed in the second patent involves an important technical advance of
considerable economic significance in relation to the first
patent;
(b) The
owner of
the first patent shall be entitled to a cross-license on reasonable
terms
to use the invention claimed in the second patent;
(c) The
use authorized
in respect of the first patent shall be non-assignable except with the
assignment of the second patent; and
(d) The
terms and
conditions of Section 95 (Requirement to obtain a license on reasonable
commercial terms), Section 96 (Compulsory licensing of patents
involving
semi-conductor technology), Section 98 (Form and contents of petition),
Section 99 (Notice of hearing), and Section 100 (Terms and conditions
of
compulsory license) of the IP Code.
Section 9. Form
and contents of petition. The petition for compulsory
licensing
must be in writing, verified by the petitioner and accompanied by
payment
of the required filing fee. It shall contain the name and address
of the petitioner as well as those of the respondents, the number and
date
of issue of the patent in connection with which compulsory
license
is sought, the name of the patentee, the title of the invention, the
statutory
grounds upon which compulsory license is sought, the ultimate facts
constituting
the petitioner’s cause of action, and the relief prayed for.
Section
10.
Notice of hearing. Upon filing of a petition, the
Director
shall forthwith serve notice of the filing thereof upon the patent
owner
and all persons having grants or licenses, or any other right, title or
interest in and to the patent and invention covered thereby as
appears
on the record in the Office, and of notice of the date of hearing
thereon,
on such persons and petitioner. The resident agent or
representative
appointed in accordance with Section 33 of the IP Code, shall be bound
to accept service of notice of the filing of the petition within the
meaning
of this Section.
Section
11.
Publication of notice. In every case, the Director
shall cause
the notice to be published in a newspaper of general circulation once a
week for three (3) consecutive weeks and once in the IPO Gazette
at
the expense of the applicant.
Section
12.
Grant of license. (a) If the Director finds
that a grant
of license under the preceding sections has been made out, he shall,
within
six (6) months from the date the petition was filed, order the grant of
an appropriate license.
(b) A compulsory
license sought for public non-commercial use shall be issued within six
(6) months from the filing of the proponent’s application or receipt of
the Board of Investment’s endorsement.
Section
13.
Terms and conditions of compulsory license. The
parties may
agree on the basic terms and conditions including the rate of royalties
of a compulsory license. In the absence of agreement between the
parties, the Director shall fix the terms and conditions including the
rate of royalties of the compulsory license subject to the following
conditions:
(a)
The scope
and duration of such license shall be limited to the purpose for which
it was authorized;
(b)
The license
shall be non-exclusive;
(c)
The license
shall be non-assignable, except with the part of the enterprise or
business
with which the invention is being exploited;
(d)
Use of
the subject matter of the license shall be devoted predominantly
for the supply of the Philippine market: Provided, that this limitation
shall not apply where the grant of the license is based on the ground
that
the patentee’s manner of exploiting the patent is determined by
judicial
or administrative process to be anti-competitive.
(e)
The
license may be terminated upon proper showing that circumstances which
led to its grant have ceased to exist and are unlikely to recur:
Provided,
that adequate protection shall be afforded to the legitimate interest
of
the licensee;
(f)
The
patentee shall be paid adequate remuneration taking into account
the economic value of the grant or authorization, except that in cases
where the license was granted to remedy a practice which was determined
after judicial or administrative process, to be anti-competitive, the
need
to correct the anti-competitive practice may be taken into account in
fixing
the amount of remuneration.
Section
14.
Amendment of compulsory license. Upon the request
of the patentee
or the licensee, the Director may amend the decision granting the
compulsory
license, upon proper showing of new facts or circumstances justifying
such
amendment.
Section
15.
Cancellation of compulsory license. Upon the
request of the
patentee, the Director may cancel the compulsory license:
(a) If the
ground
for the grant of the compulsory license no longer exists and is
unlikely
to recur;
(b) If
the licensee
has neither begun to supply the domestic market nor made serious
preparation
therefor;
(c) If
the licensee
has not complied with the prescribed terms of the license.
Section
16.
Surrender of the license by the licensee. The
licensee may
surrender the license by a written declaration submitted to the
Office.
Section
17.
Publication of the amendment, surrender, or cancellation of
the license.
The Director shall cause the amendment, surrender, or
cancellation
to be recorded in the appropriate Register of the Office, notify the
patentee,
and/or the licensee, and cause notice thereof to be published, at the
expense
of the petitioner, in the IPO Gazette.
| 
