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第二节　国际技术贸易

Section 2　International Trade in Technology

【The Fundamental】

A. Definition of Technology

According to the World Intellectual Property Organization (WIPO)^[17], technology is defined as “the systematic knowledge for product manufacture and service provision in industry, farming and commercial fields,” and knowledge is reflected in inventions, utility models^[18], designs, and in data forms. Knowledge is also shown in industrial plants, design, installation, operation, and maintenance of equipment, management of industrial ＆ commercial corporations, and the technical skill ＆ experience of experts for those activities. In this definition, it must be noted that technology comes from knowledge. However, not all knowledge is included. That is, it must be able to be transferred and it must be systematic knowledge that can satisfy needs ＆ problems that arise in special fields of human activity including industry, farming, and commerce. So, there are 3 standards in the definition of technology. First, knowledge must be systematic. This means that it must be organized in terms of providing solutions to problems; Second, knowledge must exist in certain places like in someone’s head or in documents, and must be able to be presented, so no matter what it means it must be able to be transferred from one person to another; Third, it must havepurpose-orientation, so that it can be utilized for useful purposes in industry, farming, and commercial fields.

B. Types of Technology Transfer Subjects

Assets that have economic value can be classified into tangible assets, which have specific form, and intangible assets, which do not have specific form. Here, the technologies subject to transfer are classified as intangible assets. The concept and scope of intangible asset technology is very wide and flexible. In the narrow sense, it means the manufacturing technique on the manufacturing site, confidential technology, know-how, etc, and in the wider sense it also means the entire intellectual property that has economic value. Industrial property^[19]and artistic property^[20]fall into the subjects of technology transfer^[21]. Industrial property rights are rights in relation to competitiveness in the industry and are classified into patents, trademarks and know-how. Artistic property encompasses artistic, literary, and musical works. They are protected, in most countries, by copyrights and neighboring rights^[22].

1. Patents.

A patent usually refers to the exclusive right granted to its owner by a national government for the protection and exploitation of an invention or other new technical advance, usually for a period of 20 years—the present WTO international standard. The primary method of protecting and rewarding inventors is the patent. As defined earlier, a patent is an exclusive privilege granted to an inventor, for a fixed term, to manufacture, use, and sell a product or to employ a method or a process. Most countries, accordingly, grant three basic kinds of patents:(a) design patents, which are granted to protect new and original designs of an article of manufacture; (b) plant patents, which are granted for the creation or discovery of a new anddistinct variety of a plant; and (c) utility patents, which are granted for the invention of a new and useful process, machine, article of manufacture, or composition of matter.

2. Trademarks.

Trademarks are a combination of symbols, texts, figures, and colors used to distinguish goods or services of one business from another, thus aiding both the seller and buyer in preventing confusion. Trademarks are “signs to individualize a product of a corporation, and distinguish it from the products of competitors” and are largely classified into trademarks, trade names^[23], service marks^[24], collective marks^[25], and certification marks^[26]. In practice, all five are commonly called trademarks. A service mark is a “mark used in the sale or advertising of services to identify the services of one person and distinguish them from the services of another”. When trademarks or service marks are used by members of an association, collective, or cooperative organization to indentify their products or services to members, they are called collective marks. A certification marks is a mark used exclusively by a licensee or franchisee to indicate that a product meets certain standards.

3. Know-how.

Know-how is the exclusive possession of non-publicized trade secrets, proprietary information that is a non-registered industrial property right, and consist of technologies requiring high precision which are subject to concern for patents appearing with similar technology being publicized. They are the secrets of a company wishing to hold them exclusively. These include special product technology or manufacturing methods, design plans or circuit plans, technology specifications, equipment operation guidelines, standards for combining or integrating, cost accounts, income or expenditure accounts etc. Patents are tangible rights on a macro level, but technology that cannot be patented is left to exist as know-how, and is an intangible right on a micro level comprising of special technology, and knowledge of the experience and sense of functional personnel.

4. Copyright.

A copyright is title to certain “pecuniary rights”^[27]and, in most countries, certain “moral rights”^[28]for a special period of time. These rights belong to the authors of any works that can be fixed in a tangible medium for the purpose of communication, such as literary, dramatic, musical or artistic works, films, radio and television broadcasts, and (at least in some countries) computer programs. Pecuniary rights are legislative or judicial grants of authority that entitle an author to exploit a work for economic gain. Today, most of the nearly 100 countries that grant copyrights protect two kinds of pecuniary rights: the “right of reproduction”^[29]and the“right of performance”^[30]. The personal rights of authors to prohibit others from tampering with their works are called moral rights. These rights are independent of the author’s pecuniary rights, and in most states that grant moral rights, they continue to exist in the author even after the pecuniary rights have been transferred. Regardless of its form, intellectual property is a creature of municipal law^[31]. International law does not create it. International law, however, set down guidelines for its uniform definition and protection, and it sets up ways that make it easier for owners to acquire rights in different countries.

C. Patents, Copyrights, and Trademarks under International Conventions

Lying at the heart of intellectual property protection are the laws of states having territorial application. In an effort to drive these rules of application toward greater uniformity, states have subscribed a variety of international treaties and conventions. Intellectual property rights are protected and regulated both by bilateral treaties and multilateral conventions. Bilateral treaties were the original means of preventing illegal copying, and they were once quite commonplace. With the growing popularity of multilateral conventions, their use has diminished. Multilateral conventions nowadays regulate most matters relating to intellectual property rights. These treaties generally cover industrial property or artistic property, but not both together. Moreover, patents and trademarks are commonly dealt with in a single treaty, while copyrights are dealt with separately. Most of these conventions are administered by the World Intellectual Property Organization and the Council for Trade-related Aspects onIntellectual Property Rights^[32].

1. Agreements on Trade-related Aspects of Intellectual Property Rights.

The Agreements on Trade-related Aspects of Intellectual Property Rights (TRIPS), which is an annex to the Agreement Establishing the World Trade Organization, came into effect with the WTO in 1995. As is the case for the WTO Agreement’s other multilateral annexes, all of the WTO member states are automatically members of the TRIPS Agreement.

The purpose of the TRIPS Agreement is to create a multilateral and comprehensive set of rights and obligations governing the international trade in intellectual property. As a consequence, the Agreement establishes a common minimum of protection for intellectual property rights applicable within all the WTO member states in five ways. First, it requires WTO members to observe the substantive provisions of the most important existing multilateral intellectual property treaties: the 1883 International Convention for the Protection of Industrial Property (Paris Convention) as revised in 1967; the 1886 Berne Convention for the Protection of Literary and Artistic Works (Berne Convention) as revised in 1971; the 1961 International Convention for the Protection of Performers, Producers of Phonograms, and Broadcasting Organizations (Rome Convention); and the 1989 Treaty on Intellectual Property in Respect of Integrated Circuits (IPIC Treaty). Moreover, the TRIPS Agreement provides that its substantive provisions do not in any way reduce the obligations of WTO member states under the Paris, Berne, and Rome Conventions or the IPIC Treaty. Second, the substantive provisions of the TRIPS Agreement create obligations that are meant to “fill in the gaps” in the other international intellectual property conventions. Some important provisions are otherwise missing, such as the length of life for a patent. Third, the TRIPS Agreement establishes criteria for the effective and appropriate enforcement of intellectual property rights and for the prevention and settlement of disputes between the governments of the WTO member states. Fourth, to encourage the widest possible adoption and application of the common rules and obligations set out in the TRIPS Agreement, the Agreement establishes transitional arrangements^[33]that give more time to developing member states and to member states in transition from a centrally planned economy to a free market economy to comply, and evenmore time to those that are the least developed. Finally, and most importantly, the TRIPS Agreement extends the basic principles of the General Agreement on Tariffs and Trade (GATT) to the field of international intellectual property rights. The national treatment principle requires each member state to extend to nationals of other members treatment no less favorable than that which it gives its own nationals regarding protection of intellectual property. The transparency principle requires member states to publish and notify the Council for TRIPS of all relevant laws, regulations, and the like and to respond to requests from other members for information. The TRIPS Agreement is unique, however, in including a provision requiring most-favored-nation treatment for such property. Under this provision, “any advantage, favor, privilege, or immunity granted by a member to the nationals of any other country shall be accorded immediately and unconditionally to the nationals of all other members.”

2. Berne Convention.

Adopted in Paris in 1886, the Berne Convention for the Protection of Literary and Artistic Works (Berne Convention)^[34]came into force in 1887. Its 9 original member countries have now grown to 163 as of December 2006. The Convention establishes a “union” of states that is responsible for protecting artistic rights. Four basic principles underlie the member’s obligations: (a) the principle of national treatment requires each member state to extend to nationals of other member states treatment no less favorable than that which it gives its own nationals; (b) non-conditional protection^[35]is the requirement that member states must provide protection without any formalities. A country of origin^[36]may, however, condition protection on the author’s first making an application for registration, or registering the work, or reserving rights in a contract of sale, or a similar condition; (c) the principle of protection independent of protection in the country of origin allows authors who are nationals of nonmember states to obtain protection within the Berne Union by publishing their works in amember state; (d) the principle of common rules establishes minimum standards for granting copyrights common to all member states.

3. Rome Convention.

The International Convention for the Protection of Performers, Producers of Phonograms, and Broadcasting Organizations (Rome Convention)^[37]was agreed to in 1961. The convention attempts to balance the interests of performers, producers of phonograms, and broadcasting organizations. The Rome Convention protects artists from the unauthorized recording of their original performances and from the use of authorized recordings for a purpose other than what the artist consented to. Producers of phonograms are protected from the direct or indirect reproduction of their works. Broadcasters are protected from the unauthorized recording, rebroadcasting, and use of their broadcasts. In addition to these rights, the Rome Convention provides that a broadcaster making a public communication or broadcast of an authorized phonogram is required to pay the producer or the artist, or both, a single equitable payment. This caused some consternation among several countries, which feared that such a system of compensation would diminish the proceeds that their artists were entitled to under their own laws. As a consequence, the Convention allows member states to make reservations to this provision.

4. WIPO Copyright Treaty.

The World Intellectual Property Organization Treaty^[38]was adopted in 1996 by a conference of member states of the Berne Union for the purpose of extending the provisions of the Berne Convention to computer programs and databases and protecting copyright ownership information embedded in programs and databases. Currently, there are 61 states parties as of December 2007. The Treaty provides additional protections for copyright deemed necessary due to advances in information technology since the formation of previous copyright treaties before it. It ensures that computer programs are protected as literary works, and that the arrangement and selection of material in databases is protected. Itprovides authors of works with control over their rental and distribution in Articles 6 to 8 which they may not have under the Berne Convention alone. It also prohibits circumvention of technological measures for the protection of works and unauthorized modification of rights management information^[39]contained in works.

5. Paris Convention.

Drafted in 1880, the International Convention for the Protection of Industrial Property(Paris Convention)^[40]was ratified by 11 states in 1883 and came into effect in 1884. Since then the number of participants has grown to 174 as of February 2012. The Convention establishes a “union” of states responsible for protecting industrial property rights. Among the members’duties is the obligation to participate in regular revisions. Revision conferences to expand the coverage of the Convention have been regularly held. Three basic principles are incorporated in the Paris Convention: (a) national treatment, (b) right of priority, and (c) common rules. National treatment is the requirement that each member state must grant the same protection to the nationals of other states that it grants to its own nationals. The right of priority gives an application who has filed for protection in one member country a grace period of 12 months in which to file in another member state, which then must treat the application as if it were filed on the same day as the original application. The principle of common rules sets minimum standards for the creation of intellectual property rights. These are as follows: (a) a member state may not deny protection to industrial property the work incorporating an invention was not manufactured in that state; (b) member states must protect trade names without requiring registration; (c) member state must outlaw false labeling^[41]; and (d) each member state is required to take “effective” measures to prevent unfair competition. Beyond these common rules, the convention leaves to each member the right to make rules governing the application, registration, scope, and duration of patents, trademarks, and other forms of industrial property.

6. Patent Cooperation Treaty.

The Patent Cooperation Treaty (PCT)^[42], agreed to and concluded in 1970, establishes a mechanism for making an international application whose effect in each member state is the same as if a national patent had been filed for. Applications are submitted to a member state’s patent office, which forwards them to one of several international searching authorities, where an international search is made to determine novelty. The goal of the treaty is the elimination of unnecessary repetition by both patent offices and applicants. Eventually, the member states plan to establish a single international search authority. Currently there are 118 states parties to the Patent Cooperation Treaty. A patent application filed under the PCT is called an international application, or PCT application. A PCT application does not itself result in the grant of a patent, since there is no such thing as an “international patent”, and the grant of patent is a prerogative of each national or regional authority. In other words, a PCT application, which establishes a filing date in all contracting states, must be followed up with the step of entering into national or regional phases in order to proceed towards grant of one or more patents. The PCT procedure essentially leads to a standard national or regional patent application, which may be granted or rejected according to applicable law, in each jurisdiction in which a patent is desired. The contracting states, the states which are parties to the PCT, constitute the International Patent Cooperation Union.

7. Madrid Agreement.

The Madrid Agreement Concerning the International Registration of Marks^[43], as revised in 1979, and the Madrid Protocol of 1989 create an international register, the International Bureau of Intellectual Property, derived from national registration of marks. Eligibility for international registration of a national registration is based on the applicant being a national of the contracting state where national registration has taken place, or having a commercial presence in such a state. As of early 2004, 71 states have joined in some capacity, 52 to the Madrid Agreement and 57 to the Madrid Protocol, with many having joined both. Thus, whilesome countries are not contracting states (e.g. the United States), business can still avail themselves of the convenience of the agreement where the commercial presence test is met elsewhere. The effect of the system is to provide the national registrant with automatic trademark rights coverage in all contracting states, with a validity of 20 years, renewable. Further, the system allows for greater administrative ease, for example, a single point of contact for recording changes in ownership and/or correction of the register.

8. Phonogram Piracy Convention.

The Convention for the Protection of Producers of Phonograms against Unauthorized Duplication of Their Phonograms^[44]was signed in 1971 at Geneva. It provides that member states must protect producers of phonograms from the unauthorized reproduction and importation of their works for a period of 20 years. The means for doing this is left to each individual state. In the common law countries, including the United States and the United Kingdom, protection is provided through copyright legislation. Most of the countries of continental Europe use neighboring rights laws. Japan provides protection with penal sanctions. At present, there are 69 states parties to the Phonogram Piracy Convention.

D. Technology License—The Common Form of International Technology Transfer

1. Definition of Technology License.

Technology License refers to the method of permit to execute, and is a system that the holder of the technology rights gives permission to another party in relation to the execution rights of the relevant technology based on a contract. It means the parties that give and take the execution or usage rights enter into a licensing contract^[45], and on the premise of the specified conditions including payment of technical fees for a specified period, etc., the permission for the execution or usage rights is given. After the period is over, execution and usage becomes invalid. If we compare it to products, it is similar to leasing or hiring. Sales and licensing methods are mostly used in technology transfer, but there are the following differences between the two parties and these are directly connected to the selection issue. In the case of sales where the entire right including the possession right etc. is comprehensively transferred,and the supplier generally requests a very high transfer price, but the purchaser of the technology hesitates due to the high fixed price on technology which success is uncertain. However, in the case of licensing, the concept is to permit the execution and usage of the technology, so the price for its use (usage fee or royalty) becomes much lower. In the viewpoint of the technology provider, only the execution right is given with the possession right intact, so execution permits can be given in other areas or to other parties, thus can be satisfied with only the low technology usage fee, and it is favorable for the parties seeking the license as they can make payment of the usage fee in accordance with the business results.

2. Types of the Technology Licensing Method.

a. Exclusive license^[46]. In the exclusive license, the licensor provides the right to the licensee to exclusively use within the contract area and period. It is a standard practice to include strict conditions such as minimum sales amount, minimum technical fee, restrictions in economic product dealings etc. as issuance of an identical license to a third party is not possible. This is in the position of the technology implementing party to decide whether to accept by comparing additional conditions such as the actual benefit of the exclusive license, minimum technical fee etc., and the supplier of the technology should view this in reverse.

b. Non-exclusive license. This is a method where the licensor reserves the right to provide the license not only to a particular licensee but also to other third parties and the licensor and licensee can choose as a one-off without other burdens. It is a method generally favored by the licensor. The licensee (technology implementing party) should arrange so that there are no separate burdens such as minimum technical fee etc.

c. Cross License^[47]. Cross license is the mutual exchange of specific licenses between relevant parties. For example, A company provides a license to B company for the use of its technology and simultaneously receives a license for the use of B company’s technology, and this becomes a mutual execution (cross execution). This method can be chosen when parties have a need to mutually exchange and use particular technology which the other party possesses. There are free of charge licenses and if one party profits due to economic differences, the other party is compensated for the difference.

d. Package license^[48]. Favored by the technology provider, it is a method where many technology licenses are added to a single contract and a method where technology, equipment,components, capital etc. are comprehensively provided. There is the benefit of gaining the required management resources all at once, but the cost burden is usually large. It also requires attention because there is a high probability of violating the fair trading related laws.

E. Licensing Regulations

The propriety of states adopting rules to regulate the anticompetitive aspects of intellectual property license is now specifically recognized in international law. The TRIPS Agreement provides that “nothing in this Agreement shall prevent members from specifying in their national legislation licensing practices or conditions that may in particular cases constitute an abuse of intellectual property rights having an adverse effect on competition in the relevant market.” In developing and non-free-market countries, such anti-competition rules^[49]are commonly found in transfer-of-technology codes. In the developed free-market countries, they are found in longstanding antimonopoly legislation. The United State’s Sherman Antitrust Act^[50]is a good example of this type of legislation, and similar provisions are found in the European Union’s European Community Treaty^[51].

Although it can be stated as a general proposition that (a) licenses granting statutory intellectual rights are enforceable exceptions to technology transfer codes and the unfair competition laws and (b) that licenses granting non-statutory rights must comply with both, this is only a general statement. Countries differ in their application of these general rules.

1. Export Restrictions.

Export Restrictions^[52]limit partially, or entirely, the rights of a licensee to export goodsfrom the territory where the licensee or its production facilities are located. Most countries, as a general rule, prohibit export restrictions. This general rule, however, is often subject to many exceptions.

2. Cartels.

A cartel^[53]is an agreement between several business enterprises that is designed, among other things, to allocate markets, to fix prices, to promote the exchange of knowledge resulting from technical and scientific research, to exchange patent rights, or to standardize products. Arrangements of this sort are often called cross-licensing agreements, patent pools, and multiple licensing agreements.

3. Sales and Distribution Arrangements.

A sales and distribution arrangement limits a licensee’s freedom to organize its distribution system independently of the licensor.

There are three basic approaches to the regulation of these agreements. One group of developing countries prohibits any interference by the licensor in the licensee’s system. A second group of developing and developed countries prohibit only those provisions that give the licensor exclusive distribution rights. Finally, a third group of generally developed countries only prohibit those exclusive sales arrangements that tend to allocate or monopolize markets.

4. Price-fixing.

A price-fixing clause requires a licensee to sell products at a price specified by the licensor. It may specify either maximum or minimum prices. It may be restricted to the technology or goods being licensed, or it may cover other products as well. It may apply only to the price charged by the licensee, or it may extend to the prices charged by retailers who purchase the goods from a wholesaler-licensee. Price-fixing also arises in the context of cartels, particularly cross-licensing and patent pools. Most countries—both developing and developed countries—prohibit all forms of price-fixing.

5. Challenge to Validity.

No-challenge clauses^[54]forbid a licensee from challenging the validity of the statutory right granted by the licensor. The purpose of these clauses is to ensure that a licensee willcomply with the agreed-to restrictions and payment obligations.

Only a few countries permit no-challenge clauses generally. Many developing countries expressly condemn them in their transfer-of-technology codes. Most developed countries(including the United States and the European Union) interpret their unfair competition laws as forbidding no-contest clauses in patent and copyright licenses.

Non-challenge in trademark licenses are regarded in the same negative way by developing countries and some developed countries. The European Union views such clauses as a violation of the unfair competition article of the European Community Treaty.

6. Tying Clauses.

A tying clause^[55]is a provision that requires a licensee to acquire or use, separately from the technology wanted, additional goods (such as raw materials, intermediate products, machines, or additional technology) or designated personnel either from the licensor or from a source named by the licensor. In other words, the acquisition of these additional goods or services is a prerequisite to obtaining the technology license.

In general, tying clauses are illegal in virtually every country. Most countries, however, provide for exemptions in varying degrees. The most common exemption is granted on the grounds that a tie-in is necessary to protect quality standards or to protect the goodwill of a trademark. Other exemptions in a few countries allow tie-ins if the licensee is not charged an excessive price, if the licensee is free to terminate the tie-in arrangements at any time, or if the licensee is allowed to terminate the clause as soon as a dependable local source of supply can be found.

7. Restrictions on Research and Development.

Restrictions on research and development^[56]may relate to two kinds of activities: (a) the research, adaptation, and improvement of the transferred technology or (b) the research and development of competing technologies. Both of these are condemned in almost all countries. The one significant exception is the United States, where a restriction on research to adapt transferred technology will be tolerated if it serves to preserve a product’s reputation or to protect the licensor from liability.

8. Grant-back Provisions.

A grant-back provision^[57]requires a technology recipient to transfer back to the supplier any improvements, inventions, or special know-how that it acquires while using thetechnology. Such a provision may be unilateral or reciprocal, exclusive or non-exclusive. A unilateral grant-back provision requires one of the parties—usually the licensee—to transfer back new knowledge, whereas the reciprocal provision requires both to do so. An exclusive grant-back provision requires one of the parties—usually the licensee—to transfer any rights in the new development to the other party. A non-exclusive provision would allow the parties to share these rights.

Most countries prohibit grant-back provisions that unilaterally require the licensee to transfer exclusive rights to the licensor. In contrast, most countries do not prohibit grant-back provisions that are reciprocal and non-exclusive—that is, provisions that require the parties to share the new knowledge. This is so for both “true” reciprocal exchanges (i.e. technology exchanged for technology) as well as compensated unilateral exchange (i.e. technology exchanged for money).

(Adapted from (1) Technology Transfer Principle ＆ Strategy, Technology Handbook APCTT (Asian and Pacific Centre for Transfer of Technology)；(2) Chapter 9 of Intellectual Property, International Business Law: Text, Cases, and Readings (Fifth Edition), Ray August, Washington State University, USA and published by Pearson Education International LTD. in 2009; (3) Chapter 3 of Technology Transfers, International Business Transactions (Seventh Edition), Ralph H. Folsom, University of San Diego, and published by Thomson West in 2004; (4) Chapter 11 of Intellectual Property and Licensing, International Business Law, John H. Willes, published by McGraw –Hill /Irwin in 2005.)

[The Reflections]

1. How many types of intellectual properties fall into the subjects of technology transfer?

2. What is the minimum of protection the TRIPS establishes for intellectual property rights?

3. How do you understand the relationship between the obligations a member shall assume under the TRIPS for the protection of intellectual property and those under the most important existing multilateral intellectual property treaties？

4. How do you understand the difference in and attitudes towards the regulation of anti-competition rules and the legislative model between developing countries and developed countries?

5. Are all anti-competition rules condemned and prohibited by laws?

6. In which circumstances will export restrictions be tolerated?

【The In-depth】

Technology Transfer and the Intellectual Property Issues Emerging from It—An Analysis from a Developing Country Perspective

The patent system has been claimed to be one of the way of facilitating the transfer of technology from the industrialized North to the less developed countries of the South. It is by no means the only way in which this can be done. For one thing, not all technology is patented. Also, quite often before a patented process can be successfully worked there is need for the transfer of unpatented know-how along with the technology covered by the patent. Besides, it is not the patent itself which enables the transfer of technology, rather by making the title and exclusive rights of the patentee secure, it emboldens him to transfer his technology to other for commercial exploitation. Nevertheless, the patent is an important factor in the technology transfer process.

A. What Does Technology Transfer Actually Transfer?

Of the body of economically useful knowledge that supports modern industrial production, only a small fraction is protected by patents or even by trade secrets. Greater fraction is in the public domain. Transfer of know-how is largely a question of training and teaching some-times accomplished through formal educational programmes and international exchanges, but usually through informal learning by doing and on-the-job training. This point is critical to the debate over the North-South technology transfer because while knowledge in the sense of blue-prints and formulae is indeed essentially a public good and can be made available to additional users at a marginal social cost near zero, the same is not true for training and teaching, activities that absorbs valuable resources. Where a high component of know-how is essential for consummating the transfer, the social cost of extending modern technology is likely to be significant.

That training and skill acquisition are at the heart of the technology transfer issue which is corroborated in a number of ways. First, the key role of labor force education levels has been widely acknowledged in the literature of economic development; the link of education to diffusion rates for new technology within a given country has been established empirically.Second, both the rhetoric and the policy focus of national regulation have been to increase the extent to which nationals are trained to participate in every stage of local production processes employing imported technologies. While this requirement is usually embedded in calls for“increased national sovereignty” and “breaking of neocolonial ties”, the central issue at the practical level is how many nationals will be trained to do what. Third, the preferred Southern term for the “brain drain”-emigration of skilled workers and professionals-is “reverse transfer of technology.” This is apt nomenclature; access to modern technology benefits a developing nation only to the extent that some person has the knowledge to implement it.

B. Modes of Transfer of Technology

Technology can be transferred to third parties through the transfer of the property rights on the technology, or by the granting of a user’s license. Technology covered by patents has a territorial protection. In principle, a separate patent has to be taken out in each country for one and the same invention and the exclusive right is in each case valid for that particular country. Many patent holders do not wish (or do not have the financial means) to exploit their invention in all countries where they enjoy patent protection. The transfer of property or user’s rights in respect of their national patents is, thus, a classic way to exploit the invention.

Transfer of technology takes place in a large number of ways and often incorporates not only the translation of technological knowledge into information about operational processes but other elements as well. Among the simplest forms of transaction are contracts for the services of individuals or consulting companies to provide individual elements of technology-for example, to undertake specific design or process engineering tasks, to give technological assistance during various phases of the establishment and operation of a plant, or to provide technical information services. Other transactions include licensing and trademark agreements that transfer particular proprietary product and process designs. The most commonly used modes of technology transfer are license agreement, technical assistance agreement, patents and patent agreement and know-how agreement. Among the other modes of technology transfer and know-how licensing, the most popular ones are the engineering services agreement, the trademark agreement and the franchise agreement.

C. Hybrid Agreements

The points to be considered are: (a) whether patents and know-how may be licensed in one agreement? (b) If an unchanged royalty structure may be used after the last patent has expired and royalties are only based on the know-how.

1. US Position.

Like patents, know-how may be licensed. A license agreement combining rights to patents and to know-how is quite common. However, the combination raises certain additional legal issues. In particular, one authority believes “it is indispensable for the parties to allocate royalty and other consideration to the licensed right to which it is properly allocable”.

A license agreement that requires payment of patent royalties after the last patent has expired has been held to be per se misuse. A license agreement that extends beyond the term of the licensed patents is unenforceable. In contrast, parties may agree by contract to pay royalties beyond the life of a trade secret or know-how.

For these reasons, allocation of royal ties between the patents and know-how is recommended, so that an appropriate reduction in royalties will occur after all patents have expired.

2. EU Position.

The GERTT has been specifically written to accomplish this goal. The clauses there foreseen as not requiring individual exemption by the EU Commission include patent and know-how licenses. It is generally accepted that it is safer and preferable to have a lower royalty rate after the last licensed patent expired and only know-how remains as the licensed subject matter. In practice this adds to the complexity of negotiating a deal. If no provision has been made in the contract for such a situation then the question of a reduction of royalties based on contract and antitrust law depends upon the importance of the know-how for the activities of licensee, so that in a given case the royalty may remain as agreed upon. Under the GERTT, the obligation of the licensee to continue paying royalties over a period going beyond the duration of the licensed patents is possible under Article 2(1)7b, if it facilitates payment.

D. Package License

In this regard, the points to be considered are: (a) whether more than one patent may be licensed in a single agreement? (b) Whether a licensor may tie one patent license to a different patent license? (c) Whether a licensor may charge a royalty for a group of patents, regardless of how many of these patents the licensee needs and uses?

1. U.S Position.

The current state of the law is that mandatory package licensing of patents may still be subject to a misuse defense, but any inquiry will be conducted on a “rule of reason” basis. However, tying arrangements remain illegal under § 1 of the Sherman Act and § 271(d) (5) ofthe 35 USC might not shield a patent owner from the antitrust based claims. The addition of a minimum use obligation in the unwanted licenses makes this arrangement appear more questionable and would require some special justification.

In general, a licenser who insists on an arrangement where the licenser charges a royalty for a group of patents regardless of how many of these patents the licensee needs and uses, must be able to justify it under a rule of reason analysis. One possible justification may exist where the licenser has a very large portfolio of patents and the licensee freely agrees to pay a royalty on its total sales because of the difficulty in determining exactly which of the licensed patents it is using.

However, conditioning the grant of a license on an agreement to pay royalties based on total sales regardless of actual use of the patent was held to be per se misuse by the Supreme Court in Zenith Radio Corporation v Hazeltine Research, Incorporated.

2. EU Position.

GERTT does not address the issue whether more than one patent can be licensed. It is understood and also follows from the frequent use of the plural form of ‘patents’ in the GERTT. Forcing royalty bearing license for non-necessary patents with conflict probably with or not be exempted by Article 2(1) 5 of the GERTT, which allows tying only in case of necessity for product quality standards, set by the licenser.

To force a licensee to license and pay for other patents is possible only under the limited conditions mentioned in Article 2(1) of the GERTT, and it is otherwise not permissible to tie one patent license to a different patent license, particularly with minimum use obligations for the tied in patent. Otherwise it would constitute an antitrust violation. But this is of little practical importance, since the royalty can be negotiated freely just like a lump sum.

(Adapted from Journal of Intellectual Property Rights, Vol. 9, May 2004, P260-274, Srijit Mukherjee and Sudipta Bhattacharjee, National University Of Juridical Sciences, N U J S Bhawan)

[The Terms]

1. package license: 一揽子许可

2. territorial protection：（知识产权）地域保护

3. technical assistance agreement：技术援助协议

4. engineering services agreement：工程服务协议

5. franchise agreement: 特许经营协议

6. Group Exemption Regulation-Technology Transfer：《技术转让协议集体豁免条例》

7. hybrid agreement: 混合（许可）协议

8. rule of reason: 合理原则（美国反托拉斯法适用原则）

[The Discussions]

1. The role the training and skill acquisition plays in the technology transfer.

2. The common or potential modes of the technology transfer.

3. The practicality of the hybrid agreements.

4. The special justifications for the arrangement where the licenser charges a royalty for a group of patents regardless of how many of these patents the licensee needs and uses.

【The Further Sources】

John H. Barton, New Trends in Technology Transfer: Implications for National and International Policy, Issue Paper No. 18, ICTSD programme on IPRS and Sustainable Development, February 2007,

C Correa, Intellectual Property Rights and the Use of Compulsory Licenses: Options for Developing Countries, South Centre T.R.A.D.E. Working Paper No.5, (1999).

B. Hoekman, K. Maskus, ＆ K. Saggi, Transfer of Technology to Developing Countries: Unilateral and Multilateral Policy Options, World Bank Policy Research Working Paper 3332, June 2004.

Carole Deschamps, Patenting Computer-related Inventions in the US and in Europe: The Need for Domestic and International Legal Harmony, European Intellectual Property Review, 2011 Volume 33 Issue 2.