PCC wants to have a say in technology transfer agreements
THE Philippine Competition Commission (PCC) is seeking to participate in the approval process for technology transfer agreements (TTAs), which are currently the domain of the Intellectual Property Office of the Philippines (IPOPHL), citing competition issues that may arise from such deals.
Competition Commissioner Johannes Benjamin R. Bernabe said the agency aims to come up with guidelines that will reconcile its overlapping mandate with the IPOPHL over TTAs.
Republic Act 8293, known as the Intellectual Property (IP) code, refers to TTAs as contracts or agreements 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.
“The IP office used to have jurisdiction over these but now, because of the PCC, who will determine?” Mr. Bernabe told BusinessWorld last week in Makati City.
Mr. Bernabe said the PCC and IPOPHL have been in dialogue since 2016 to address the issue and may draft a memorandum of agreement (MoA) as a first move.
“We can have a MoA but the MoA that we normally have with other agencies might not be sufficient for purposes of the required coordination. We need to have more discreet and distinct rules to govern how we interact with one another because there are certain provisions in the Intellectual Property (IP) code, particularly as they relate to technology transfer where investors have to abide by certain principles,” he said.
As such, Mr. Bernabe hopes the PCC can take on a role in the review of TTA applications.
“When the IP office receives such deals, because of the enabling MoA, certain rules will kick in. We can even sit in with their officers who analyze those deals so the competition principles are observed,” Mr. Bernabe added.
Competition concerns are addressed in the IP Code through the prohibition of TTAs with anti-competitive clauses; compulsory licensing even without the agreement of the patent owner; and the exhaustion of rights and regulatory review exceptions.
TTAs prohibited from registration should not contain tying arrangements; price restraints; restrictions on volume and production; exclusive dealing arrangements; purchase options in favor of the licensor; exclusive grantback conditions; or royalty payments for unused patents.
Other prohibited clauses in a TTA are export restrictions; restrictions on technology use upon expiry of the agreement; royalty payments for expired intellectual property rights; non-challenges to patent validity; restrictions to adaptations of the technology; non-liability clause or exemption from liability arising from non-fulfillment of obligations, among others.
IPOPHL Director-General Josephine R. Santiago expressed willingness to further the discussion in drawing up harmonizing guidelines.
“It’s nice to really sit down [with them] so that we’re also exposed to the kinds of issues that PCC are looking at… We’ll sit down with them very soon,” Ms. Santiago said in an interview last week in Taguig City.
The IPOPHL also noted that the PCC can ensure that TTAs respect the Philippine Competition Act (PCA) of 2015 by monitoring the implementation of TTAs after their approval.
The IPOPHL approved at least 26 TTAs last year. — Janina C. Lim