Proposed Dominican Republic legislation on Industrial Property

The USPTO provided Consumer Project on Technology this December 1998 English translation of the proposed Dominican Republic legislation on Industrial Property. These are the sections pertaining to compulsory licensing.



Article 347.- Exploitation of the Patent

For the effects of Article 349 of this law, exploitation of a patent is understood as follows:

a) When the patent has been granted for a product or for a procedure for the obtaining of a product, supply to the internal market in reasonable quantity, quality and price, through production in this country and importation.

b) When the patent has been granted for a procedure not included in subparagraph a), the use of the procedure on a commercial scale in this country.

Article 348: Obligatory Licenses

348.1 When a potential user has attempted to obtain the granting of a license from the patent. holder under reasonable--commercial terms and conditions and such attempts have not been effective after a period of one hundred eighty (180) days, counted from the date on which the respective license was applied for, the General Agency for Industrial Property, after prior hearing of the holder, shall issue obligatory licenses relating to that patent.

348.2 To determine what is understood by reasonable commercial terms and conditions, the particular circumstances of each case and the economic value of the authorization must be taken into account, keeping in mind the average rate of royalties for the sector in question in contracts for commercial licenses between independent parties.

Article 349.- Obligatory License for Lack of Exploitation

349.1 After three (3) years from the granting of the patent, or four (4) years from the filing of the application, applying whichever term expires later, if the invention has not been exploited or when the exploitation of the same has been interrupted for more than one (1) year without justifiable cause, any person with the ability to exploit the invention may apply to the General Agency for Industrial Property to grant him or her an obligatory license for the patent in question.

349.2 An obligatory license shall not be granted when it is demonstrated that the lack or insufficiency of exploitation is due to fortuitous circumstances or force majeure, or to circumstances beyond the will or control of the patent holder and which justify the lack or insufficiency of exploitation. The lack of economic resources and the lack of economic viability of the exploitation are not considered justifying circumstances.

Article 350.- Obligatory Licenses for Anti-competitive Practices

350.1 Obligatory licenses shall be granted when the General Agency for Industrial Property has determined that the patent holder has indulged in anti-competitive practices. In such cases, without prejudice to the appeals available to the patent holder, the concession shall be carried out without the need to apply the procedure set forth in subparagraph c) of Article 352.

350.2 For the purposes of this law, the following practices, among others, are considered to be anti-competitive: a) Setting excessive or discriminatory prices for the patented products. In particular, when there are offers of supply to the market at prices significantly lower than those offered by the patent holder for the same product.

b) Failure to supply the market under reasonable commercial conditions.

c) Hindrance of commercial or productive activities

d) The other actions set forth as such by this code and every other action, which national legislation typifies as anti-competitive, limiting or restrictive to competition.

Article 351: Application for and Granting of Obligatory Licenses

351.1 Any person interested in obtaining an obligatory license must apply for it to the General Agency for Industrial Property. The application must indicate the conditions under which he or she intends to obtain the obligatory license.

351.2 The person applying for an obligatory license must confirm that he or she has previously requested a contractual license from the patent holder, and has not been able to obtain it under the conditions and within the time limits set forth in Article 348. It shall not be necessary to fulfill this requirement in cases of national emergency or extreme urgency, or cases of a commercial use of the invention by a public agency. In such cases the patent holder shall be informed without delay of the granting of the license. Nor shall it be necessary to fulfill that requirement when the purpose of the license is to remedy an anti-competitive practice.

351.3 Without prejudice to that which is set forth in Article 351.2, the General Agency for Industrial Property shall notify the patent holder of an application for obligatory license within a period of thirty (30) days, counted as of day of the filing of the application.

351.4 The patent holder must present his statements and arguments within a time limit no more than sixty (60) days, counted from the date of notification of the application for an obligatory license. If this time limit passes without the holder having expressed himself, the conditions presented by the applicant shall be considered as accepted.

351.5 In case the holder responds, the General Agency for Industrial Property, after first hearing the parties and if they should not come to agreement, shall set a reasonable remuneration which the patent holder shall receive, which shall be established according to Article 348.

351.6 The decisions with reference to the granting of these uses must be adopted within one hundred twenty (120) days from the filing of the application and the ,same shall be appealable. The substantiation of the appeal shall not have the effect of suspension.

Article 352.- Conditions for the Granting of Obligatory Licenses

352.1 To grant obligatory licenses, the following provisions must be observed:

a) The granting of same must be by the General Agency for Industrial Property.

b) The circumstances of each case shall be considered.

c) The obligatory licenses shall be extended to patents relating to the components and processes permitting their exploitation

d) The granting of these licenses shall not be exclusive.

e) They may not be assigned, except for that part of the company or of its intangible asset that forms part of it.

f) They shall be granted principally to supply the internal market, except in the cases established in Articles 349 and 354.

g) The patent holder shall receive a reasonable remuneration, according to the circumstances of each case, taking into account the economic value of the authorization. In determining the amount of the remuneration in cases in which the obligatory licenses have been granted to remedy anti-competitive practices, the necessity of correcting such practices shall be taken into account and the revocation of the grant may be denied if it is considered probable that the conditions that caused that granting have been repeated.

352.2 The person to whom the obligatory license is granted must begin its exploitation within two years of the granting of the license to him.

352.3 When the patent protects any semiconductor technology, obligatory licenses shall be granted only for non-commercial public use, or to rectify a practice declared to be contrary to competition.

352.4 An obligatory license may be completely or partially revoked by the court created by this Code, upon request by the holder, if the circumstances that gave rise to the license have ceased to exist and it is improbable that they will again arise, so long as such revocation does not affect the legitimate interests of the licensee.

352.5 An obligatory license can be modified by the court created by this Code, upon application by an interested party, when so justified by new facts or circumstances.

Article 353: Obligatory License in the case of Dependent Patents

353.1 When an invention claimed in a subsequent patent cannot be exploited in this country without infringing an earlier patent, the General Agency for Industrial Property, upon the request of the holder of the first mentioned patent or of his licensee, or of the beneficiary of an obligatory license for that patent, may grant an obligatory license with regard to the earlier patent insofar as may be necessary to avoid the infringement.

353.2 The obligatory license shall be granted only when the invention claimed in the subsequent patent implies an important technical advance of considerable economic significance with regard to the invention claimed in the earlier patent.

353.3 When an obligatory license is granted in conformity with Article 353.1, an obligatory license may be granted in the same circumstances with regard to the later patent, if the holder of the earlier patent, his licensee or the beneficiary of an obligatory license for said earlier patent applies for it.

353.4 An obligatory license of those set forth in this article cannot be granted as exclusive. This obligatory license can only be the object of transfer simultaneously with the dependent patent the industrial exploitation of which requires the license. The transfer of the obligatory license shall be subject to the provisions of Article 340.2, insofar as is appropriate.

353.5 The provisions of Articles 351 and 35L insofar as they are appropriate, are applicable to the licenses set forth in this article.

Article 354: Public Interest Licenses

For reasons of public interest, and in particular for reasons of emergency or national security declared by the Executive Power, the General Agency for Industrial Property, at the request of any interested person or competent authority, or on its own initiative, shall at any time order the following:

a) that an invention which is the object of a patent or patent application being processed be exploited by a government agency or by one or more public or private persons designated for the purpose.

b) that an invention that is the object of a patent or of a patent application being processed be open for the granting of licenses in the public interest, in which case the General Agency for Industrial Property. shall grant a license for exploitation to any person who applies for it and has the ability to carry out such exploitation in this country.

Article 355: Conditions for Public Interest Licenses

355.1 Every public interest license implies the corresponding payment to the patent holder. After prior hearing of the parties, and in the absence of an agreement, the amount and method of payment shall be set by the General Agency for Industrial Property.

355.2 A public interest license can refer to the execution of any of the actions referred to in Article 337.1

355.3 The provisions of Articles 351 and 352, insofar as appropriate, are applicable to the granting of public interest licenses.

355.4 The granting of an obligatory license by reason of public interest shall not diminish the right of the patent holder to continue exploiting it.

Article 356: Revocation of the Patent in Case of Abuse

356.1 At the request of any interested person or of any competent authority, the General Agency for Industrial Property can revoke a patent when the rights conferred by the patent are abused with regard to anti-competitive practices or abuse of a dominant market position in such a way that the national economy is unduly affected.

356.2 The request for revocation may not be presented until two years have passed counting from the date of granting of the first obligatory license.