FIFTEENTH CONGRESS OF THE 
REPUBLIC OF THE PHILIPPINES 
First Regular Session 
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SENATE 
S.B.No. 1405 
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Introduced by Senator Loren Legarda 
EXPLANATORY NOTE 
This bill seeks to re-establish the Philippine Inventors Commission that will 
serve as the lead agency that will promote research and development, provide 
comprehensive support services to Filipino inventors and protect their inventions. 
Article XIV, Section 10 of the Constitution provides that the State shall give 
priority to research and development, invention, innovation, and their utilization 
and to support indigenous, appropriate, and self-reliant scientific and technological 
capabilities, and their application to the country's productive systems and national 
life. Currently, the Technology Application and Promotion Institute (TAPI) under 
the Department of Science and Technology (DOST) is taking the lead in 
implementing Republic act No. 7459, the law providing incentives to Filipino 
investors and inventions. RA. No. 7459 only expanded the function of TAPI but had 
difficulties providing the necessary support mechanism that will have a significant 
impact on the sector. 
The intent of the Constitutional provision to harness local Inventions for 
national progress would be advanced further if there would be an agency with the 
appropriate and sufficient mandate, powers and resources to formulate and 
implement programs that have far-reaching impact on the plight of Filipino 
inventors. RA. No. 3850 had created such an agency, the Inventors Commission. 
However, said Commission was effectively abolished by way of Executive Order 
No. 128. At present, the need for re-instituting an agency such as the Inventors 
Commission becomes ever relevant as the role of science and technology is more 
pronounced in economic development in the Philippines and elsewhere. 
This bill will strengthen the mechanisms for providing the much needed 
support to Filipino inventors· by rationalizing programs for research and 
development, manufacture and market of our inventive ideas, products, processes 
and such other areas of technology development. 
In view of the foregoing, the immediate passage of this bill is sought. 
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.co> 
LOREN LEGARDA 
Senator 


FIFTEENTH CONGRESS OF THE 
) 
REPUBLIC OF THE PHILIPPINES 
) 
First Regular Session 
) 
SENATE 
1405 
S.B. No., __ _ 
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Introduced by Senator Loren Legarda 
AN ACT 
CREATING A PHILIPPINE INVENTORS COMMISSION, DEFINING ITS 
POWERS, FUNCTIONS AND DUTIES, AND FOR OTHER PURPOSES THAT 
WILL ENCOURAGE THE GENERATION, DEVELOPMENT, MANUFACTURE, 
PROMOTION AND MARKET OF THE PHILIPPINE INVENTIONS. 
Be enacted by the Senate and House of Representatives of the Philippines in Congress 
assembled: 
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SECTION 1. Title. -This Act shall be known as the "Inventors and Invention 
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Incentives Acts of 2010." 
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SECTION 2. Declaration of Policy. -It is hereby declared a policy of the State 
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to give priority to research and development, invention, innovation, and their 
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utilization. The State shall also support indigenous, appropriate, and self-reliant 
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scientific and technological capabilities, and their application to the country's 
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productive systems and national life. 
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Further, the State shall regulate the transfer and promote the adaptation of 
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technology from all sources for the national benefit. It shall encourage the widest 
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participation of private groups, local governments, and community-based 
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organizations in the generation and utilization of science and technology. 
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Furthermore, the State shall protect and secure the exclusive rights of 
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scientists, and investors to theill intellectual property and creations, particularly 
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when beneficial to the people, for such period as may be provided by law. 
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SECTI<?N 3. Philippine Inventors Commission. -The Philippine Inventors 
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Commission is hereby re-established as provided for under Republic Act No. 3850, 
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as amended. The Philippine Inventors Commission, hereinafter referred to as the 
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Commission, shall be under the Office of the President of the Republic of the 
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Philippines for the purpose of giving technical, financial, legal and marketing 
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assistance to Filipino inventors and their inventions. 
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SECTION 4. Functions ahd Responsibilities. -The Commission shall have 
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the following functions, power and duties: 
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a) To render technical assistance to inventors by examining their submitted to 
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determine their patentability and by helping them prepare their patent 
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application, under certain terms and conditions; 
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b) To grant financial aid to inventors to enable them to develop, perfect and 
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produce their patented inventions or those that are pending patent, under 
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certain terms and conditions; 
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c) To render legal assistance to inventors by representing them in filling their 
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patent application here mad/ or abroad and in protecting their patent from 
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infringement in patent cases, under certain terms and conditions; 
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d) To facilitate financial assistance from local and international lending 
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institutions for the development of inventions that are beneficial to our 
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country for long term loans to enable inventors to manufacture their 
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inventions, with only their letters patent as collateral, the amount of loan to 
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be granted depending upon the importance and market of their inventions as 
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determined by the Commission; 
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e) To develop and establish import and export assistance program and help 
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inventors find markets for their inventions here and abroad; 
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f) To encourage Filipino inventors to promote their inventions by holding 
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periodic citations and awa~ds to patented inventions in the Philippines in the 
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field of agriculture, chemistry, commerce, communications, education, 
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engineering, fishery, forestry, medicine, national defense, pharmacy, physics, 
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public safety and welfare, public works, transportation and other fields of 
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science, which shall be open to all Filipino inventors who may submit entries 
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in one or more fields; 
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g) To establish and maintain a public research laboratory and experimental 
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station where authorized inventors and researchers may avail themselves of 
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its facilities and services for carrying out or perfecting their approved 
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inventions and researches: Provided, that the inventor or researcher shall agree 
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to give the Commission at least one tenth of all royalties arising from the 
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commercialization and market of their ideas, products and processes for the 
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use of its facilities to help maintain the public research laboratory and 
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experimental station: Provided, further, that the laboratory facilities and 
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services of the Department of Science and Technology and other government 
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agencies, offices and instrumentalities shall be made available to inventors or 
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researchers who may need the same, as recommended by the Commission 
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against which the expenses incurred in such laboratories shall be chargeable; 
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The determination of royalty shall be based on the existing international 
standards. In case there is no royalty arrangement in the commercialization 
and/ or production and m~rket of the assisted ideas, products and processes, 
the inventor or researcher shall give the commission at least five (5) percent of 
the net income derived from the therefrom. Proceeds from all kinds of 
assistance rendered by the Commission shall accrue to its account and shall 
be used to carryout its objectives and mandate. 
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h) To assist inventors, scientists and researchers in joining international 
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competitions including market development abroad; 
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i) To publish and disseminate information about inventions researches and 
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science in general; and 
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j) To organize creative societies in schools, colleges and universities to promote 
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and encourage creativeness among our youth. 
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SECTION 5. Organization. -The Commission shall be composed of a Board 
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of Commissioners organized under a Chairperson to be assisted by four (4) 
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Commissioners appointed by the President. They shall hold office for seven (7) years 
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unless otherwise renewed. Each shall be a Filipino citizen and at least twenty-five 
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(25) years of age. They shall exercise collective decision making as the highest 
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policymaking body of the Commission. The Board of Commissioners shall 
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promulgate and implement rules and regulations necessary to perform the functions 
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of the Commission to carry out tht! provisions of this Act. 
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The Commission shall have the following standing departments: Intellectual 
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Property and Legal Department, Finance Department, Administrative Department, 
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Research and Development Department, Project Development and Business 
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Consultancy Department, Record and Information Department. The Commission, 
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with the approval of the President, may create additional units deemed necessary by 
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the Board of Commissioners. 
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SECTION 6. Invention Zone. -The Commission, with the approval of the 
President, may select a suitable location on any public land owned by the National 
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Government for the site of its public research laboratory, experimental station and 
manufacturing plants! factories or branch thereof with housing facilities for the 
inventors and researchers working therein to be known as Invention City and! or 
Invention Economic Zone. Within three (3) months from receipt of the choice of the 
Commission duly approved, the Director of Lands shall cause the chosen site to be 
surveyed, delimited and transferred to the Commission to be placed under its 
exclusive jurisdiction and control. 
SECTION 7. Consolidation of R.A. 7459. -
All functions, duties and 
responsibilities referring to the promotion and development of inventions conferred 
upon the Technology Application and Promotion Institute and! or Department of 
Science and Technology under Republic Act No. 7459 are hereby transferred to the 
Commission which shall hereafter exercise those functions. All real and personal 
properties, moneys, assets, bequests, devices and the like accumulated in the 
exercise of those functions in implementing the said Acts shall also be transferred to 
the Commission: Provided, That the research and development (R&D) fund under 
Section 7 of RA. No. 7459, the Invention Development Assistance Fund, shall be 
increased and provided under the General Appropriation Act in the initial amount 
of Five Hundred Million Pesos (PSOO,OOO,OOO.OO) pursuing the global average of 2% 
of the gross national product (GNP) allocated for research and development 
activities. 
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SECTION 8. Exemption from Taxes and Fees. - To promote, encourage and 
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accelerate the manufacture and sale of home grown and/ or adopted inventions or 
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technologies, the inventors and their inventions shall be exempted from all kinds of 
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taxes effective from the date of the tax exemption approval, such as the following: 
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(a), Exemption from the payment of direct and indirect taxes, customs 
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duties exercise taxes, import value added taxes, and other charges on import of 
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machinery/equipment, parts and materials and other components which shall be 
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actually directly and exclusively used for the manufacturer and market of the 
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invention/ technology; 
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(b) 
Exemption from the payment of income and value added taxes on the 
income derived from the commercialization and market of their inventions and 
technologies; 
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Exemption from the payment of fees, and such other fees required for 
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the renewal of the patent fees, and such other fees required for the renewal of patent 
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certificate by the Intellectual Property Office, exemption from the payment of license 
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and business permits fees, inspection fees, and realty taxes on machinery and 
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equipment used for 
the development, 
manufacture 
and 
sale 
of 
their 
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invention/technology; all of which tax exemption privileges shall be extended to 
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their legal heir, or assignee/licensee: Provided, that any business entity, organization 
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and the like of which the inventor in an owner or stockholder of not less than 50% of 
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the total capital shall be extended the same tax exemption privilege. 
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SECTION 9. Exemption from Donor's Tax. - All donations and grants to the 
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Commission shall be tax-exempt and deductible in full from the donor's income tax 
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returns when evidenced by a certificate duly issued the Commission. Any person 
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who evades or defeats, or attempts to evade of defeat in any manner any tax 
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imposed by law by availing himself of the provisions of this section through fraud 
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or misrepresentation shall be punished by a fine not more than Fifty Thousand 
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Pesos (P50,OOO.OO) or imprisonment not exceeding one (1) year or both, in the 
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discretion of the court. In case the violator is a corporation or association, the 
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president or general manage thereof shall be criminally liable, without prejudice to 
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the criminal responsibility of the member, officer or employee thereof committing 
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such violation. 
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SECTION 10. Constitution of Board of Commissioners. - The Board of 
Commissioners shall be constituted by the President within three months from the 
approval of this Act to formulate the implementing rules and regulations and 
organize the Commission. 
SECTION 11. Appropriations. -There is hereby appropriated the sum of One 
Hundred Fifty Million Pesos (PI50,OOO,OOO.OO) to fund the initial year of the 
Commission's operation. Further, it is hereby authorized to be appropriated 
annually such sums as may be necessary to carry out the provisions and objectives 
of this Act to be included under the general appropriations for the Office of the 
President: Provided, that these sums shall not be less than the original appropriation 
of one hundred fifty million pesos. 
SECTION 12. Repealing Clause. - All laws, decrees, orders, rules and 
regulations or portions thereof inconsistent with the provisions of this Act are 
hereby repealed, amended or modified accordingly. 
SECTION 13. 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. 
SECTION 14. Effectivity. - This Act shall take effect fifteen (15) days after its 
publication in at least two (2) new~papers of general circulation. 
Approved, 
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