THIRTEENTH CONGRESS 01: THE1 
REPlJBLlC OF TliE t-"II.IPPIK\'ES 
J 
Firs1 Regular Scssion 
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Introduced by Senator Magsaysay, Jr. 
The Constitution of the Republic of the Philippines mandates under Article X I  
Section 14 and Article X V  Sections 10 to 13 that the State shall prioritize and support 
science and technology as economically essential to national progress and prosperity 
through research and development (R&D) as well as protect Filipino inventors and their 
inventiom: DeploraGy; this mandate has not been optimized or maximized by way of an 
effective legislation. Republic Act No. 7459, known as the Inventors and Inventions 
Incentives Act of the Philippines, is only an expanded fimction of the Technology 
Application and Promotion Institute (TAPI) and which is only one over twenty (1/20) or 
so of its programs. TAPI was creation of the Executive Order No. 128 which virtually 
abolished Republic Act 3850, as amended, that created the Philippine Inventors 
Commission. 
Our Philippine Inventors Commission, believe it or not, was made a paradigm for 
the countries of Sri Lanka and South Vietnam. They have theirs and sadly, this is cardiac 
(JIII) in 1094 and was reconstituted on focused government support in 1906. Eve y body 
should know what happened next? South Korea did its own by organizing the Korean 
Invention Promotion Association (KIPA) in 1973. Despite Korea's aggressive tn.
st ce on 
note why we lost ours? Japan organized the Japan Institute of Invention and I 
invention and innovation system, KIPA was given more power and support in 1994. 
Does everybody know the Korean economic miracle? Our Filipino Inventors Society, 
Inc. was organized in 1943 during the raging World War I1 to generate and develop the 
inventiveness of the Filipino, and survive in such serious crisis. It has been doing on its 
own with only a meager or trickle of support of government. 
This bill seeks to re-establish an Inventors Commission as per RA 3850, as 
amended, to effectively define its powers, duties, functions and responsibilities and 
clearly provide for the real and impacting incentives and support mechanism to be 
extended to the Filipino inventors. The bill will also rationalize plans and programs 
concerning R&D, commercialization and market of our inventive ideas, products and 
processes on the following grounds: 
1. The bill will focus on its inherent mandate, thus avoiding dissipation of efforts 
and improving the delivery on its inherent mandate, and thereby, rectlfy the 
shortcomings of RA 7459, particularly in expanding the functions of TAPI 
without providing the much-needed manpower complement and resource 
support; and 
2. It will rationalize and focus current efforts to develop and more effectively 
promote inventiveness in the country, and thereby, rectify the shortcoming of 
RA 7459, particularly in expanding the functions of TAPI without providing 
the much-needed manpower complement and resource support; and 
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3. Aggressively encourage more Filipino inventors to come forward with new 
inventive ideas, products and processes which will viably and sustainably 
impact on the country's economy and provide them with fiscal and non-fiscal 
incentives, technical, legal, managerial and business assistance in 
commercializing and marketing their inventions. 
Foregoing premises considered early approval or enactment of this bill is 
earnestly prayed for. 
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THIRTEENTH CONGRESS OF THE) 
REPUBLIC OF THE PHILIPPINES ) 
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First Regular Session 
1 
Introduced by Senator Magsaysay, Jr, 
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Inventors and Inventions Incentives Act of the 2004.” 
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Pursuant to the Constitution of the Republic of the 
hereby declared to be the national policy giving priority to invention and 
its utilization on the country’s productive systems and national life, and 
to this end provide incentives to inventors and protect their exclusive 
rights to their inventions, particularly when such inventions are 
beneficial to the people contributing to national development and 
progress. 
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I 
3.1 
3.2 
3.3 
3.4 
3.5 
3.6 
3.7 
3.8 
3.9 
Invention refers to, for the purpose of this Act, any pa ented 
machine, product, process including implements or tools 
and other related gadgets, utility model and ind strial 
Inventor refers to the patentee(s), heirs, assignee(s) ofs an 
invention, utility and industrial design letters patent; 
Technology means the application of knowledge or science 
which shall include all others such inventions, innovations, 
and results of researches; 
design; 
! 
s to the Department of Science and Technology; 
to the Department of Finance; 
the Department of Agriculture; 
efers to the Department of Environment and Natural 
to the Intellectual Property Office; 
o the Filipino Inventors Society, Inc. 


1’s refers to the Research and Development Institute of 
DOST. 
en& O f  a 
- To pursue the 
as a matter of national policy, there is 
hereby re-established an Inventors Commission, as per RA 38 0, as 
amended, to be known as the National Inventors Commission, und r the 
Office of the President of the Republic of the Philippines, herei after 
referred 
to as Commission, for the purpose of providing tec nical, 
financial, managerial, legal and marketing assistance to F 1 
lipino 
Inventors and their Inventions. The Commission shall provide program 
to set up a conducive climate/atmosphere to the generation, 
development 
and 
market of 
inventions and innovations, give 
encouragement and support to inventors who are creative and 
resourceful, as well as those imbued with deep sense of nationalism, and 
maximize the their capacity and productivity. 
- The Commission shall have the following powers, duties 
and functions: 
5.1 
5.2 
5.3 
5.4 
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5.5 
5.6 
To render technical assistance to inventors by examining 
their submitted invention applications to determine their 
patentability and by helping them prepare their applications 
under certain terms and conditions; 
To grant financial aid to inventors to enable them to develop, 
perfect and produce and market their inventions or those, 
which are pending patent, under certain terms and 
conditions; 
To render legal assistance to inventors by representing them 
in filing their patent applications here and/or abroad and in 
protecting their patents from infringement cases, 
under 
certain conditions; 
To extend financial assistance and/or recommend to 
government lending institutions for support funds inventions 
tha<---are beneficial to our country with their patents as 
collateral; 
To develop and establish import and export assistance 
program for inventions to accelerate their production and 
market here and abroad; 
To encourage Filipino inventors to make known their 
inventions by giving annually sizeable cash awards, medals 
and certificates/diplomas of merit in the fields of science and 
technology and/or invention to be determined and 
from time to time by the Screening Committee 
as recommended by the Commission. 
organize a panel of judges to 
deserving invention, utility model, 
The 
creative researches: 
5.6.1 First Prizes - For invention, utility model, industrial 
design and creative research categories to be known as 
Presidential Awards; and 
5.6.2 Second and Third Prizes for the same categories as 
stated above. 
The Commission may establish 
consolation prizes to selective entries in all categories; 


5.7 
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To establish and maintain facilities such as public research 
laboratory, machine shop and experimental station where 
inventors, scientists and researchers shall carry out their 
works 
in 
perfecting 
their 
inventive, 
scientific 
and 
technoloscal ideas, products and processes. Provided, that 
the inventors, scientists and researchers shall agree to give 
to the Commission at least one percent (1%) of royalty 
arising from commercialization/production and market of 
the assisted ideas, products and processes certain percent 
but not lower than five percent (So/,) of the net income 
derived there from shall agreed upon. The proceeds fr m all 
kinds of assistance rendered by the Commission shall ccrue 
to its account or fund and shall be used to carry ut its 
international competitions including market develo 1 
ment 
objectives. 
5.8 
To 
assist inventors, scientists and researchers join 
abroad; 
To hold regular monthly sessions for the exchange of ideas 
and information among inventors; and observe and/or help 
supervise the annual general assembly of the FIS; 
5.10 To organize creative/inventive societies in schools, college 
and universities to encourage, generate, develop and 
promote creativity and resourcefulness among the youth of 
the land; 
5.11 To publish, disseminate and exchange information about 
inventions, researches and science in general. 
5.9 
. All functions, duties and responsibilities referring to the 
promotion and development of inventions conferred upon the Technology 
Application and Promotion Institute and/or DOST under Republic Act 
No. 2067 and Republic Act No. 7459 are hereby transferred to the 
Commission which shall hereafter exercise those functions, duties apd 
responsibilities. All real and personal properties, money assets bequests, 
devises and the like accumulated in the exercise of those functions, 
duties and responsibilities in the implementation of said Acts shall be 
transferred to the Commission. 
Provided, That the Commission may 
choose to deposit any its funds in any government banks and/or private 
banks as it deems necessary and favorable in the intent of this Act. 
Provided, further, That the research and development fund under Sectipp 
7 of 
7459, -the Invention Development Assistance Fund, shall be 
accordingly increased and provided under the General Appropriation Act 
in the initial amount of Five Hundred Million Pesos (P500,000,000.00) 
pursuing the global average of two percent (2%) of the gross national 
product (GNP) . 
i 
ttee - The Screening Committee shall 
four (4) members as per RA 7459. It 
The Commission may relinquish 
shall be chaired by the Commission. 
from time to time to other members as it deems necessary. 
The Filipino Inventors Society, Inc. shall be the insti ution 
to coordinate with the Commission in consultation with the othe duly 
registered inventors and research societies to achieve the noble in ent of 
this Act. The Commission shall exert all necessary efforts to unite and 
harmonize all inventors and research societies under the umbrella of the 
FIS. 
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The Commission shall be headed by a Chairman to be 
assisted by two (2) Commissioner appointed by the President of the 
Philippines. They shall hold office for seven (7) years unless otherwise 
renewed. Each shall be a Filipino citizen, at least twenty five (25) years 
of age. The Chairman and the Commissioners shall receive an annual 
compensation of not more than the existing salary grade of any other 
government agency of the same level, and may be removed earlier from 
office f8F-a cause.- 
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The Commission shall have the following divisions: 
Development; Business Enterprise Development and 
Consultancy; Patent and Legal; Applied Communication and Promotion; 
Administrative; Finance; and appropriate sections for Personnel, 
Records, General Services, Property, Accounting and Cashiering shall be 
subsumed under relevant units and/or divisions. To better assure the 
attainment of the objectives of this Act, the heads of the divisions shall 
be a Filipino citizen of at least twenty-five (25) years preferably those 
having at least one letters patent issued here or abroad. 
The 
Commission shall determine the annual compensation of the d'vision 
heads and other staff/personnel. 
Such technical and adminis rative 
personnel, as may be necessary to carry out their functions, duti 1 
s and 
responsibilities, shall be appointed by Chairman of the Commission 
subject to the approval of the President. 
11. All donations and grants to the Commission shall be tax 
exempt and deductible in full from the income tax returns of the donor 
when evidenced by a certificate duly issued by the Commission. Any 
person who evades or defeats, or attempts to evade or defeat in any 
manner any tax imposed by the law by availing himself of the provisions 
of this section through fraud or misrepresentation shall be punished by a 
fine of not less than FIFTY THOUSAND (P50,OO.OO) or imprisonment not 
exceeding one (1) year or both, in the discretion of the court. In case the 
violator is a corporation or association, the president or general manager 
thereof shall be made criminally liable, without prejudice to the criminal 
responsibility of the member, officer or employee thereof committing such 
violation. 
. To promote, encourage and accelerate the manufacture 
and sale of home-grown and/or adopted inventions or technologies, the 
inventors and their inventions shall be exempted from all kinds of taxes 
for a period of ten (10) years effective from the date of the tax exemption 
approval, such as the following: 
12.1 
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Exemption from the payment of direct and indirect q e s ,  
customs duties, excise taxes, import value added taxes, ahd 
oth& charges on import of machinerylequipment, parts and 
materials and other components which shall be actually, 
directly and exclusively used for the manufacture and 
market of the inventions/technology; 
Exemption from the payment of any income derived from the 
commercialization 
and 
market 
of 
their 
inventions/ technologies including valued added taxes; 
12.3 Exemption from payment of fees, and such other fees 
12.2 
required from the renewal of patent certificate 
Intellectual Property Office; 


12.4 Exemption from any payment of license and business permit 
fees, inspection fees, and realty taxes on machinery and 
equipment used for the development, manufacture and sale 
of invention/technology. All these tax exemption privileges 
shall be extended to any business organization ,and the like 
in which the inventor is an owner or stockholder of not less 
than fifty percent (50) of the total capital. 
12.5 Exemption from any public bidding for purposes of 
government procurement/purchase as a matter of national 
patronage pursuant to Article XI1 Sections 12 to 14 of the 
Constitution 
of 
the 
Republic 
of 
the 
Philippines, 
Commonwealth Act No. 138 and the General Appropriation 
The Commission shall issue tax exemption certificate and such other 
certificate as an exemption to the powers and authorities of the Bureau 
of Internal Revenue, Department of Finance, local government units and 
such other agencies concerned to carry out the incentive principle and 
objectives of this Act. 
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Act;.-.- 
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e. 13. The Commission shall have the power to review all tax 
exemption and other incentives privileges granted under this Act and 
may recommend punitive sanctions such as recall of tax exe ption 
certificate and others actions for the abuse of the same. 
. The Commission shall exercise an arbitration po er to 
organize when necessary an Arbitration to help settle and/or enc urage 
extra judicial settlement of conflicts, problems and the like be etting 
between and among inventors and inventors organizations in order to 
foster unity, harmony and camaraderie among themselves. 
An 
Arbitration Board shall be presided over by the Commission with at least 
three (3) members invited from disinterested organizations of veritable 
and respectable reputation and one (1) from the FIS. 
I 
. The Commission shall be constituted within one month 
from the approval of this Act and the sum of One Hundred Fifty Million 
(P150,000,000.00), for the release immediately to the Commission to 
carry out as soon as possible the objectives of this Act. 
e There is hereby authorized to be appropriated annually 
such sum as may necessary to carry out the provisions and objectives'of 
this Act to be included under the General Appropriation Act of the One 
hundred Fifty Million Pesos (P150,000,000.00). 
. 17. Any unconstitutionality of any section, subsecpan, 
lause or terms of this Act shall not affect the validity of tke 
other provisions thereof. 
The Commission shall, subject to the approval of the 
President of the Philippines, promulgate such rules and regulations as 
may be necessary for the conduct and exercise of the functions, powers 
and duties of the-Commission under this Act. 
a 
Republic Act No. 7459 is hereby consolidated 
subsumed, and other provisions law, rules and regulations or order 
contrary or inconsistent with the provision of this Act are hereby 
repealed or modified. 


e This Act shall take effect immediately upon approval. 
Approved,