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Legislative Implementation of Flexibilities - Egypt

Title:Articles 23 and 24 of the Law on the Protection of Intellectual Property Rights No. 82 of 2002
Field of IP:Patents
Type of flexibility:Compulsory licenses and government use
Summary table:PDF

Provisions of Law

Article 23

The Patent Office may, subject to the approval of a ministerial committee to be established by a decision of the Prime Minister, grant non-voluntary licenses for the exploitation of an invention. The committee decides the financial rights of the patent owner when such licenses are issued, in any of the following cases:

(1) Where the competent Minister finds - under the circumstances - that the exploitation of the patent will benefit the following:

(a) Public non-commercial interest. This includes the preservation of national security, health, environment and food safety.(b) Cases of emergency or circumstances of extreme urgency.

A non-voluntary license to counter the conditions mentioned in items 1 and 2 is granted without prior negotiations with the patent owner or after a certain period of negotiations with the patent owner or offering reasonable conditions to acquire his agreement to the exploitation.(c) Support of national efforts in vital sectors for economic, social and technological development, without unreasonable prejudice to the rights of the patent owner and taking into consideration the legitimate interests of third parties.

In cases stated in items 1 and 3, the owner of the patent shall be notified promptly of the decision of non-voluntary exploitation, and as soon as reasonably practicable in cases stated in item

2 .(2) Upon the request of the Minister of Health, when the quantity of patented medicines made available fail to adequately meet the national needs, due to their poor quality or if they are offered at a prohibitive price, or if the patent is related to medicines addressing critical cases, incurable or endemic diseases or products used in the prevention of these diseases, or where the invention is related to the medicines, their manufacturing process, the raw materials necessary for their preparation or the process of manufacturing of those materials.

In all these cases, the decision of granting non-voluntary license shall be notified promptly to the owner of the patent.

(3) Where the patent owner refuses to grant license to a third party seeking the exploitation of the invention, whatever the purpose of the exploitation, and despite the offer of suitable terms and the lapse of reasonable negotiation time.In this case, the party requesting the non-voluntary license shall provide evidence that he has made serious efforts to obtain a voluntary license from the patent owner.

(4) If the owner of the patent fails to exploit the invention in Egypt, himself or through his consent; or if the patent was not sufficiently exploited after the lapse of four years since the date of the application or three years since the grant of the patent, whichever comes later; or if the patent owner suspended, without a valid reason, the exploitation of the patent for more than one year.The exploitation of a patent shall be through the manufacturing of the patented product or the use of the patented process in Egypt.Nevertheless, where the Patent Office finds that, despite the expiration of either of the above mentioned time limits, failure to exploit the invention was due to legal, technical or economic reasons beyond the power of the owner of the patent, it may decide to allow him a sufficient period of grace for the exploitation of the invention.

(5) If it is determined that the patent owner has abused of or exercised the rights conferred by the patent in a manner that is contrary to fair competition, such as:Fixing exorbitant prices for the patented products or preferential treatment of agents with regards to prices and sales conditions.Failure to supply the local market with the patented product, or supplying it under prohibitive terms.Stopping the production of the patented item or its production in a disproportionate manner, given the production capacity and the market needs.Undertaking acts or practices which have adverse effect on the free competition, according to the prescribed legal norms.Exercising of the rights conferred by the this Law in a manner that adversely affects the transfer of technology.In all above cases, the non-voluntary license is granted without recourse to negotiation or the expiry of a time limit thereto, even if the non-voluntary license is not intended to satisfy the needs of the domestic market. The Patent Office may refuse to terminate the non-voluntary license, where the conditions that called for it are likely to remain or to reoccur.

The compensation due to the owner of the patent shall take into account the prejudice caused by his arbitrary or unfair competition practices.

The Patent Office may revoke the patent if, two years after the grant of a non-voluntary license, it became clear that the grant of that license was not adequate to remedy the adverse effects caused to the national economy by the r the patent owner's abuse of his rights or his unfair competition practices.

Any concerned party may challenge the revocation of a patent before the Committee provided for in Article 36, and in accordance with the conditions and procedures prescribed in the Regulations.(6) Where the exploitation of an invention by the legitimate patent holder requires inevitably the use of another invention, underlying concrete technical advance as well as technical and economical significance compared to the other, he shall be entitled to obtain a non-voluntary license for the exploitation of the other invention, in which case the other patent holder shall equally have the same right.The licensed exploitation of one patent may not be assigned without the corresponding assignment of the other.

(7) The grant of a non-voluntary license in the field of semi-conductor technology shall be authorized for public non-commercial purposes only, or to remedy the consequences of any unfair competition practices.The grant of non-voluntary licenses in the cases provided for in this Article, shall be in accordance with the rules and procedures prescribed in the Regulations.

Article 24

Where a non-voluntary license is to be issued, the following elements shall be taken into account:

(1) A request for the grant of the non-voluntary license shall be considered on the merits of each case. The license shall mainly seek to satisfy the needs of the domestic market.(

2) The requesting party shall prove that he has made serious attempts during a reasonable period of time to obtain a voluntary license from the patent holder against fair compensation, and that he failed.

(3) The patent owner may, within one month from his notification of the grant of the license, appeal to the Committee provided for in Article 36 and in accordance with the conditions and procedures stipulated by the Regulations, against the decision to grant the non-voluntary license to a third party.

(4) The party requesting the grant of a non-voluntary license, or the party to whom a non-voluntary license is granted, must have the capacity to efficiently exploit the invention in Egypt.

(5) The licensee must abide by the scope, terms and period prescribed by the decision granting the such a license. The Patent Office may extend the duration of the license if it expires without achieving its purpose.

(6) The use of the non-voluntary license shall be limited to the applicant; the Patent Office may however grant it to a third party.

(7) The beneficiary shall not assign the rights of a non-voluntary license to a third party except with the enterprise or the part related to the exploitation of the patent.

(8) The patent owner shall be entitled to a fair compensation for the exploitation of his invention. The amount of the compensation shall be fixed on the basis of the economic value of the invention. He shall have the right to appeal against the compensation assessment, within 30 days of being notified the decision, before the Committee provided for in Article 36, in accordance with the rules and procedures prescribed by the Regulations.

(9) The non-voluntary license shall lapse on the expiry of its duration. Nonetheless, the Patent Office may decide to terminate the non-voluntary license if the reasons which led to its grant cease to exist and are unlikely to reoccur; in which case, the procedure prescribed by the Regulations shall apply.

(10) The patent owner may request the termination of the non-voluntary license before its expiry, if the reasons which led to its grant cease to exist and are unlikely to reoccur.

(11) Where a non-voluntary license is terminated before its term, the legitimate interests of the licensee shall be taken into account.

(12) The non-voluntary license may be terminated or its terms amended by the Patent Office, or upon a request from any interested party, if within two years after the grant of the non-voluntary license, the licensee fails to exploit the subject matter of the license or to meet his obligations as prescribed by the license.

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