RESTRICTED
WORLD TRADE IP/Q3/ISL/1
5December 1997
ORGANIZATION(97-5370)
Original: English Council forTrade-Related Aspects
ofIntellectual Property Rights
REVIEW OFLEGISLATION INTHE FIELDS OFPATENTS, LAYOUT-DESIGNS
(TOPOGRAPHIES) OFINTEGRATED CIRCUITS, PROTECTION OF
UNDISCLOSED INFORMATION AND CONTROL OF
ANTI-COMPETITIVE PRACTICES IN
CONTRACTUAL LICENCES
Iceland
Thepresent document reproduces theintroductory statement made bythedelegation ofIceland,
thequestions puttoitandtheresponses given inthereview oflegislation onpatents, layout-designs
(topographies)ofintegratedcircuits,protectionofundisclosedinformationandcontrolofanti-competitive
practices incontractual licences attheCouncil 'smeeting of26-30 May1997.1
_______________
I. INTRODUCTORY STATEMENT
Ofthelawsandregulations notified byIceland under Article 63.2oftheTRIPS Agreement,
there aretwoActsofparticular relevance tothisreview process.
ThePatents ActNo.17waspassed in1991 andentered intoforce on1January 1992. The
Actwasamended byActNo.67of1993, andthisversion canbefound indocument IP/N/1/ISL/P/1.
The1993 amendments extended patent protection toinventions concerning stimulants orfoodstuffs.
Provisions concerning exceptions from theexclusive rightwerealsoamended inlightofobligations
stemming from theagreement establishing theEuropean Economic Area.
Further amendments weremade in1996through ActsNo.36and91,thetextsofwhich have
beennotified indocument IP/N/1/ISL/I/1.2Some ofthese amendments were made because ofthe
TRIPS Agreement, others duetotheEEA Agreement.
Protection wasextended toinventions concerning pharmaceuticals inaccordance withtheTRIPS
Agreement, theprovision concerning priority waswidened andthose relating tocompulsory licences
were changed inaccordance withArticle 31oftheTRIPS Agreement. Tocover theprovision of
Article 34oftheAgreement concerning theburden ofproof inrespect ofprocess patents, anew
1Theminutes ofthemeeting have been circulated indocument IP/C/M/13.
2Asregards lawsandregulations relevant totheareas under review asnotified byIceland under Article 63.2ofthe
Agreement, reference isalsomade todocuments IP/N/1/ISL/P/1-2, IP/N/1/ISL/I/1-2, IP/N/1/ISL/L/1 andIP/N/1/ISL/N/1.
Subsequent tothemeeting oftheTRIPS Council of26-30 May1997, asupplementary notification submitting anew, complete
version ofRegulation No.286/1996, asnotified byIceland anddistributed aspartofdocument IP/N/1/ISL/P/2, wasreceived
from thedelegation ofIceland anddistributed asreflected indocument IP/N/1/ISL/P/2/Add.1.IP/Q3/ISL/1
Page2
Article 64awasadded tothePatents Act.Anewpartorchapter concerning supplementary protection
wasadded totheAct,inlinewithobligations undertaken inthecontext oftheEEA. With these
amendments theprocedure wasalsochanged. Now anopposition against apatent ismade afterthe
granting ofthepatent instead ofbefore.
Toprovide abriefstructural description, thePatents Actisdivided intoXIParts. PartIcontains
general provisions, PartIIprovisions onthepatent application anditsprocessing, PartIIIinternational
applications, andPartIVaddresses theextent ofprotection andtermofthepatent. PartVdeals with
payment ofrenewal fees, PartVIlicensing, transfer etc.,andPartVIIcontains provision onthe
termination ofthepatent. PartVIIIplaces anapplicant under anobligation togiveinformation about
patents under certain conditions, PartIXaddresses liability topunishments, damages etc.,andPartIXa
deals withsupplementary protection. PartXcontains miscellaneous provisions and,finally, PartXI
setsoutprovisions concerning entry intoforce.
ActNo.78concerning theprotection oftopographies ofintegrated circuits onsemiconductors
waspassed in1993, withimmediate entry intoforce. ThisActwasamended in1995byActNo.19,
andthetextsofthese Actsarecontained indocument IP/N/1/ISL/L/1.
TheActprovides foranexclusive righttotheexploitation ofatopography ofintegrated circuits
onsemiconductors. Exclusive rightisestablished when thetopography isfirstfixed orencoded and
expires tenyearsfromthecalendar yearwhen thetopography wasfirstcommercially exploited anywhere
intheworld.
Theprotection isprovided fordesigners independent ofnationality orresidency.
II. REPLY TOTHE GENERAL QUESTION ONPRIORITY RIGHTS3
Doesyourcountry recognize aright ofpriority onthebasis ofanearlier patent application
filedinanyother WTO Member byanational ofaWTO Member?
Theanswer isyes.Thisrecognition isexplicitly stated inSection 1ofPartIofActNo.36/1996
(see document IP/N/1/ISL/I/1) andArticle 6ofRegulation No.286/1996 (see document
IP/N/1/ISL/P/2/Add.1).
III. REPLIESTOQUESTIONSPOSEDBYTHEEUROPEANCOMMUNITIESANDTHEIR
MEMBER STATES
1. Could theGovernment ofIceland clarify itssystem ofpatent protection? Isitthecase
thatnopatent protection isavailable forfilings between 1January 1996, thedateoftheapplication
oftheTRIPS Agreement byIceland and1June1996? Furthermore, regarding inventions made
inthesector ofpharmaceutical andagricultural chemical products, doesthelegislation ofIceland
provide fora"mailbox andmarketing system" pursuant toArticles 70.8and70.9oftheTRIPS
Agreement tocover theperiod between 1January 1995 and1June 1996? Please explain.
Iceland assumes thatthePatents ActNo.17/1991 asamended byActNo.67/1993,
ActNo.36/1996 andActNo.91/1996 hasbeenavailable toallWTO Members (seeIP/N/1/ISL/P/1,
IP/N/1/ISl/I/1).
3Atthemeeting oftheTRIPS Council of27February 1997, Members agreed torespond tothisquestion inthecontext
ofthepresent review (document IP/C/M/12, paragraph 18).IP/Q3/ISL/1
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ItmaybesaidthattheIcelandicpatentsystemisidenticaltothesysteminotherNordiccountries.
Thelegislation isvery similar totheDanish legislation, except fortheprovisions concerning
pharmaceutical andagricultural chemical products andtheentry intoforce ofthose provisions.
TheIcelandic Patents ActNo.17/1991 entered intoforce on1January 1992. Inatemporary
provision, Section 75,itwasstated thatpatents forpharmaceuticals should notbegranted untilafter
fiveyears fromtheentry intoforce oftheAct.However, itwaspossible togrant apatent foraprocess
formanufacturing suchmaterial. Itwasthuspossible togetaprocess patent butnotaproduct patent.
DuetotheTRIPS Agreement thedateforthistemporary provision waschanged with
ActNo.36/1996. With Section 27ofActNo.36/1996, paragraph 2ofSection 75wasamended
andnowreads asfollows: "After June1,1996, patents forpharmaceuticals maybegranted onthe
basis ofapplications filedafter1January, 1995".
Asconcerns patent protection forfilings between 1January and1June1996, thequestion asked
bytheEuropean Communities appears tobebased onmisunderstanding. Patent protection hasofcourse
beenavailable forfilings between 1January and1June1996. Aspreviously stated, thetemporary
provision regarding patents forpharmaceuticals inparagraph 2ofSection 75wasamended with
ActNo.36/1996. This Actentered intoforce on1June 1996 anditprovides thatpatents for
pharmaceuticals maybegranted after1June1996onthebasisofapplications filedafter1January 1995.
Since thePatents Actwasnotchanged induetimewithrespect totheapplication oftheTRIPS
Agreement inIceland, theamendment isretroactive.
Itshould bepointed outthatthePatent Office wasaware oftheprovisions oftheTRIPS
Agreementandcouldthereforehandlepatentapplicationsforpharmaceuticalproductsasifthelegislation
hadalready beenamended.
Thelegislation ofIceland didnotprovide fora"mailbox andmarketing system" pursuant to
Sections 70.8and70.9atthetimeofentryintoforceoftheAgreement Establishing theWTO. However,
Icelandic authorities haveinpractice respected theprovision inSection 70.8. Before 1June1996only
process-inventions inthefieldofpharmaceuticals werepatentable according toIcelandic legislation.
Patent applications claiming forpharmaceutical products aswellasprocess havehowever beenaccepted
from 1January 1995. Allapplications forpharmaceutical processes thathavebeenreceived from
1January 1995 include claims forproduct. Theexamination ofthese applications wasdelayed until
1January 1996inaccordance withArticle 70.8andnodecision wasmade untilafterActNo.36/1996
hadentered intoforce. Allapplications forpharmaceutical products which werereceived in1995and
thefirsthalfof1996 will,asamatter offact,behandled inaccordance withArticle 70.8.
ActNo.36/1996 covers themailbox provision through itsretroactive character.
[Follow-up question from theUS]
Initsanswers tothequestions posed bytheEuropean Communities, Iceland indicated
thatitdidnotmake product patent protection available forpharmaceutical andagricultural
chemical products asof1January 1995. Ithasindicated thatitaccepted filings ofthese
applications notwithstanding thisfact. Inrelation tothisissue, please answer thefollowing
questions:
(a) What steps weretaken bytheIcelandic Government tocommunicate tothepublic
thefactthatitwasaccepting product patent applications forpharmaceutical and
agricultural chemical products?IP/Q3/ISL/1
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(b) What laws, regulations oradministrative practices have been implemented by
Icelandtogoverningthehandlingofapplicationsdrawntoineligiblesubjectmatter?
(c) What measures havebeenimplemented inIceland toprovide exclusive marketing
rights forproducts thatarethesubject ofmailbox applications andthatsatisfy
thecriteria ofArticle 70.9oftheTRIPS Agreement?
Iceland refers toitsreplies toquestions posed bytheEuropean Communities andtheirMember
States. Virtually allpatent applications filedinIceland concerning pharmaceuticals andagricultural
products areforeign. Theses applications areforwarded totheIcelandic Patent Office byagents. All
agents known tothePatent Office wereinformed thattheadministrative practice asof1January 1995
wastohandle allapplications inconformity withtheTRIPS Agreement.
Nospecific lawsorregulations tothiseffect were issued untilthePatents Actwasamended
byActNo.36/1996, which hasretroactive influence.
Allpatent applications available totheIcelandic public receive provisional protection according
toSection 60oftheIcelandic Patents Act. Thatwould include exclusive marketing rights according
toSection 3.
2. Howdoesthelegislation ofIceland implement Article 70.7oftheTRIPS Agreement which
provides thatinthecaseofintellectual property rights forwhich protection isconditional upon
registration, applications forprotection which arepending onthedateofapplication oftheTRIPS
Agreement fortheMember inquestion shall bepermitted tobeamended toclaim anyenhanced
protectionprovidedunderthisAgreement,exceptwhereanewmatterisconcerned?Pleaseexplain.
Inthesummer of1995acommittee wasappointed bytheMinister ofIndustry andCommerce
toconsider Article 70.7andtheobligations setouttherein. Thecommittee concluded thatapplications
foraprocess patent could notbetransformed tocover product patents. According totheArticle an
amendment oftheapplications cannot include "new matter". Thedistinction between process of
manufacture andproduct isclear. When theoriginal application wasfileditwasnotpossible tohave
patent protection forpharmaceutical products. Amendments tocover theproducts would therefore
beconsidered newmatter. Adifferent understanding would imply aretroactive influence notapparently
intended, asArticle 70.1indicates.
IV. REPLIES TOQUESTIONS POSED BYJAPAN
1. Inyour country, arethefollowing subject matters protectable bypatent: (1)plants and
animals, and(2)plant andanimals varieties?
Iceland assumes thatthePatents ActNo.17/1991 asamended byActNo.67/1993,
ActNo.36/1996 andActNo.91/1996 hasbeenavailable toallWTO Members (seeIP/N/1/ISL/P/1,
IP/N/1/ISL/I/1).
According toSection 1(4)(2) oftheIcelandic Patents ActNo.17/1991, apatent shallnotbe
granted forplant oranimal varieties oressentially biological processes fortheproduction ofplant or
animals.
Itisnotdirectly prohibited inthePatents Acttogrant apatent forindividual plants andanimals.
However, theprovision ofSection 1(4)(1) regarding inventions which would becontrary tomorality
orpublic order might leadtothatconclusion.IP/Q3/ISL/1
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[Follow-up question from theUS]
Please clarify whether thefollowing products areeligible tobepatented inIceland ifthe
product isnew, involves aninventive stepandisindustrially applicable:
(a) microbiological products andprocesses;
(b) plants andanimals, perse,thathavebeenproduced through some actofhuman
intervention .
Theanswer tothisquestion haspartly beengiven inresponse toaquestion raised bythe
delegation ofJapan.
According toSection 1(4)(2) oftheIcelandic Patents Act, patents maybegranted for
microbiological processes andproducts resulting form suchprocesses.
Thissame Section stipulates thatapatent shallnotbegranted forplant oranimal varieties or
essentially biological processes fortheproduction ofplants oranimals. ThePatents Actdoesnot
specifically prohibit thegranting ofapatent forplants andanimals, perse.However, theprovision
ofSection 1(4)(1) regarding inventions which would becontrary tomorality orpublic order might
leadtothatconclusion. Obviously, thiswould needtobeevaluated onacase-by-case basis.
2. Inyourcountry, istheactofoffering forsaleincluded intheexclusive rights ofpatent?
Theexclusive rights conferred byapatent aredescribed inSection 3oftheIcelandic Patents
Act. Theactof"offering forsale" iscovered asstipulated inSection 3(1).
[Follow-up question from theUS]
Please verify thattheexclusive rights provided through thegrant ofanIcelandic patent
under Article 45oftheIcelandic Patents Actextend tothepatent owner theright topreclude
theimportation ofproducts subject tothepatent.
Theexclusive rights conferred byapatent aredescribed inSection 3oftheIcelandic Patents
Act. Iceland failstoseehowArticle orSection 45canberelevant tothisquestion. Areading of
Section 3willconfirm thattheowner ofanIcelandic patent hastherighttopreclude theimportation
ofproducts protected bythepatent.
3. Inyour country, what kinds ofactsarerecognized asexceptions totheexclusive rights
conferred byapatent right?
Exceptions totherights conferred byapatent arelisted inSection 3(3)oftheIcelandic Patents
Act. They are:
1. usewhich isnotcommercial;
2. useoftheproduct protected bythepatent which isputonthemarket within the
European Economic Area bytheproprietor ofthepatent orwithhisconsent;
3. useoftheinvention forexperiments which relate totheinvention itself;IP/Q3/ISL/1
Page6
4. preparation inapharmacy ofamedicine inaccordance withaphysician 'sprescription
inindividual cases oractswiththemedicine soprepared.
4. Inyourcountry,inwhichcaseisusewithouttheauthorizationoftherightholderpermitted,
including usebythegovernment orbythird parties authorised bygovernment?
InPartVIoftheIcelandic Patents Actthere areprovisions regarding licensing, transfer etc.
Section 45stipulates thatifapatented invention isnotworked toareasonable extent inIceland
when three years havelapsed fromthegrant ofthepatent andfouryears haveelapsed fromthefiling
ofthepatent application, anyperson wishing towork theinvention inIceland mayobtain acompulsory
licence todosounless there arelegitimate reasons forthefailure towork theinvention.
According toSection 46,theproprietor ofapatent foraninvention, theexploitation ofwhich
isdependent onapatent heldbyanother person, mayobtain acompulsory licence toexploit theinvention
protected bythelatter patent iftheformer invention isconsidered torepresent animportant technical
advance,whichhasconsiderableeconomicsignificance.Ifsuchacompulsorylicenceisgrantedpursuant
totheabove, theproprietor oftheinvention shall beentitled toobtain, upon reasonable terms, a
compulsory licence toexploit theother invention.
Section 47stipulates thatwhen required byimportant public interests, anyperson whowishes
toexploit aninvention commercially forwhich another person holds apatent mayobtain acompulsory
licence todoso.
Section 48reads asfollows:
"Any person who, inthiscountry, atthetimewhen apatent application wasmade
available tothepublic, wascommercially exploiting theinvention forwhich apatent
isapplied for,may, iftheapplication results inapatent, obtain acompulsory licence
toexploit theinvention ifveryspecial circumstances make itdesirable andhehadno
knowledge andcould notreasonably haveobtained anyknowledge oftheapplication.
Sucharightshallalso,under similar conditions, beenjoyed byanyperson whohad
made substantial preparations forcommercial exploitation oftheinvention inthis
country.
Acompulsory licence inaccordance withparagraph 1mayinclude thetimepreceding
thegrant ofthepatent."
Section 49wasamended byActNo.36/1996 duetotheprovisions inArticle 31oftheTRIPS
Agreement.IP/Q3/ISL/1
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5. Inyourcountry, howistheobligation under Articles 34.1and34.2oftheTRIPS Agreement
regarding theshiftoftheburden ofproof incivilproceedings forpatent infringement related
toaprocess patent implemented?
Theobligation under Articles 34.1and34.2oftheTRIPS Agreement isimplemented by
Section 64aoftheIcelandic Patents Act,which reads asfollows:
"Should apatent involve amethod forproducing anovel product, thenifthissame
product isproduced byaperson other thantheholder ofthepatent, itshall be
considered ashaving beenproduced bymeans ofthepatented method unless proved
otherwise. Inpresenting proof ofthecontrary, thelegitimate interests oftheparties
toprotect production andcommercial secrets shallberespected."