Senate
SEVENTEENTH CONGRESS OF THE REPUBLIC) AOE Ls)
OF THE PHILIPPINES )
Third Regular Se:

ird Regular Session ) 18 AUG -9 A947
SENATE

s.B.NO._ 1925

Introduced by Senator Maria Lourdes Nancy S. Binay

AN ACT
CLARIFYING THE LEGAL EFFECT OF VIOLATING THE PROHIBITED ACTS
AND MANDATORY PROVISIONS FOR TECHNOLOGY TRANSFER
AGREEMENTS, AMENDING FOR THE SAID PURPOSE SECTION 92 OF
REPUBLIC ACT 8293 OR THE INTELLECTUAL PROPERTY CODE OF THE
PHILIPPINES

EXPLANATORY NOTE
As a way of facilitating technology transfer in the Philippines, the Intellectual |
Property Code (“IP Code”) provides mechanisms to encourage the transfer and |
dissemination of technology, prevent or control practices and conditions that may
in particular cases constitute an abuse of intellectual property rights having an
adverse effect on competition and trade. For this purpose, Section 85 of the
Intellectual Property Code requires that all technology transfer arrangements |
shall comply with the provisions of the Code.

In furtherance of the above objective, Section 87 prohibits the inclusion of
certain types of provisions deemed prima facie to have an adverse effect on
competition and trade. In addition, Section 88 also provides for mandatory
provisions that should be included in voluntary license contracts.

To enforce the above provisions, Section 92 provided the legal consequence of
non-compliance with Section 87-88, as follows:



“Section 92. Non-Registration with the Documentation, Information and
Technology Transfer Bureau. ~ Technology transfer arrangements that
conform with the provisions of Section 86 and 87 need not be registered
with the Documentation, Information and Technology Transfer Bureau.
Non-conformance with any of the provisions of Section 87 and 88,
however, shall automatically render the technology transfer arrangement
unenforceable, unless said technology transfer arrangement is approved
and registered with the Documentation, Information and Technology
Transfer Bureau under the provision of Section 91 on exceptional cases.”

The term “unenforceable” appears to be legally incorrect and inconsistent

with the principle that acts contrary to law are void. It entertains the possibility

that

if the parties violate Section 87-88, they are given the opportunity to ratify

the contract declared by operation of law to be illegal. The possibility of

ratification renders nugatory, if not severely weakens, efforts of the Intellectual
Property Office to ensure compliance with Section 87-88.

In View of the foregoing, the passage of this Bill is earnestly requested

MARIA LOURDES NAI S. BINAY
Senator



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SEVENTEENTH CONGRESS OF THE REPUBLIC)
OF THE PHILIPPINES ) . .
Third Regular Session ) 18 AUG -9 A947

S.B. no. 4925 REL

Introduced by Senator Maria Lourdes Nancy S. Binay

AN ACT
CLARIFYING THE LEGAL EFFECT OF VIOLATING THE PROHIBITED ACTS
AND MANDATORY PROVISIONS FOR TECHNOLOGY TRANSFER
AGREEMENTS, AMENDING FOR THE SAID PURPOSE SECTION 92 OF
REPUBLIC ACT 8293 OR THE INTELLECTUAL PROPERTY CODE OF THE
PHILIPPINES

Be it enacted by the Senate and House of Representatives of the Philippines in
Congress assembled:
Section 1. Section 92 of Republic Act 8293 is hereby amended to read as

follows:

Section 92. Non-Registration with the Documentation, Information

and Technology Transfer Bureau. - Technology transfer

arrangements that conform with the provisions of Sections 86 and

87 need not be registered with the Documentation, Information

and Technology Transfer Bureau.

Non-conformance with any of the provisions of Sections 87 and
88, however, shall automatically render the technology transfer
arrangement VOID AB INITIO, unenforceable —unless—said
technology -transfer-arrangement is approved and registered-with
the Documentation, Inf Technology Transfer B

der—the provisions of Section 94 -ptionat a
TECHNOLOGY TRANSFER ARRANGEMENT UNDER THE



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PROVISIONS OF SECTION 91 ON EXCEPTIONAL CASES ARE NOT
COVERED BY THIS PARAGRAPH.

Sec. 2. Separability Clause. - Should any part or provision of this Act be
declared unconstitutional or invalid, other parts or provisions hereof not
otherwise affected thereby shall remain in full force and effect.

Sec. 3. Effectivity. - This Act shall take effect fifteen (15) days after its
publication in at least two (2) newspapers of general circulation.

Approved,