Since we are receiving wide range of inquiries on technology transfer and the requirements for Fairness Opinion that is being issued by the Secretary of the Department of Science and Technology from the public in general, and from policymakers, technology managers, researchers, professors and students in particular, we deem it practical to provide this “Primer” in order to serve you better. Please do not hesitate to get in touch with us if you have specialized concerns.
INTELLECTUAL PROPERTY (IP) RIGHTS PROTECTION
(1) IP protection is not a mandatory requirement for technology transfer, but would be very useful as it provides the ultimate (and the shortcut) proof of technology ownership when a technology will be offered for commercialization.
(2) Forms of IP are the following: Patents, Utility Models, Industrial Design, Trademark, Copyright, Plant Variety Protection, among others. If the IP Owner decides not to register its IP and forever make it a secret, a great deal of effort is needed in order to maintain such invention as a Trade Secret. For additional quick references on the basics of IP, you may check this presentation.
(3) Among its programs of assistance, the DOST’s Technology Application and Promotion Institute (DOST-TAPI) offers free IP protection to Filipino citizens, academe, and public entities by shouldering all costs associated from filing to grant. Interested parties may get in touch with Engr. Edgar I. Garcia, Director of DOST-TAPI, thru Engr. Janeth N. Cruzada at email@example.com or 02-837-2017 local 2150.
(1) In the Philippines, technology transfer for publicly funded research projects is governed by the Republic Act No. 10055, otherwise known as the “Philippine Technology Transfer Act of 2009”. Its Implementing Rules and Regulations were jointly issued by the DOST and the Intellectual Property Office of the Philippines (IPOPHL).
(2) Technology transfer may be done even during the R&D stage but is preferably performed when the technology is already mature for commercialization.
(3) There are different modes of technology transfer depending on the nature of the technology and if there are IP’s associated with the technology, among a few. Modes may be Direct Sale, Licensing, Spinoffs, Deployment (free), Extension (free), among others. In short, technology transfer may be also classified as commercial or non-commercial in nature. Moreover, specially for licensing, it is advisable that a trained negotiator or negotiation team is commissioned by the Technology Owner in order to get the best arrangements with the potential “taker” or investor prior to signing of agreements.
(4) In order to immediately roll out publicly-funded technologies, the DOST launched its First Technology Transfer Day last April 2016 in Manila, and due to this success, DOST also conducted the same in Visayas and Mindanao to showcase DOST-generated technologies later that year.
LEGAL REQUIREMENT FOR FAIRNESS OPINION
(1) Fairness Opinion is required for all proposed technology transfer agreements arising from government-funded researches. It shall be issued by the DOST Secretary.
(2) The DOST Secretary is advised, through a Fairness Opinion Report (FOR), by a Fairness Opinion Board (FOB) that is specifically convened to evaluate the proposed transaction as to its fairness to the Government Funding Agency (GFA) or the R&D Institution (RDI). DOST-TAPI serves as the Secretariat of the FOB.
a. Within 30 days: To convene the Fairness Opinion Board from the date the request for Fairness Opinion is received by the Secretariat.
b. Within 60 days: (i) FOB to evaluate the request for Fairness Opinion and to visit the facilities of the Licensor and Licensee if it deems needed, (ii) To issue an FOR advising the Secretary why the proposed transaction is “Fair” or “Not Fair” to the GFA or RDI; and (iii) To release the Fairness Opinion of the DOST Secretary from the date the FOB was convened.
(4) Requirements are as follows (please see the guidelines, too):
a. Proposed transaction (not yet formalized),
b. Valuation report,
c. Due diligence report on the parties to the transaction,
d. Background documents regarding the prospective transferee, AND
e. List of potential recommendees for FOB membership.
(5) As an innovation of the FOB Secretariat, a fast-tracked mechanism to issue Fairness Opinion is available for proposed transactions that will fall under ideal terms that FOBs in specific industries decided to be automatically acceptable as “Fair”. This fast-tracked mechanism trims down the waiting period from up to 90 days to about one to ten days only, assuming that the requirements are complete, otherwise a “full-blown” FOB evaluation (please see Item 3 above) may be recommended. (Caezar Angelito E. Arceo)
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