Category: Insights

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Indigenizing the Intellectual Property System

As the rest of the world observes the International Day of the World’s Indigenous Peoples (Aug. 9), we at CFIP Law, hope to spread more awareness on the lack of protection given to the culture and heritage of our indigenous brethren. In their article for the IPWatchdog, Inc, our founding partners, Atty. Mario Jr Cerilles and Atty. Harry Gwynn Omar Fernan advocate for a global intellectual property system that is more sensitive to the plight of our IP communities.

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Overcoming Obstacles to the Quest for Genuine Accountability for Drug-Related EJKs in the Philippines

The article of Atty. Mario Jr Cerilles was recently published in the Ateneo Law Journal’s issue on “Developments in Criminal Law”.
In his article entitled, “Overcoming Obstacles to the Quest for Genuine Accountability for Drug-Related EJKs in the Philippines”, Mario analyzes the weaknesses of the country’s legal framework on the investigation and prosecution of EJKs, and suggests concrete ways to exact genuine accountability for the victims of the drug war.

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Intellectual property solutions to our COVID-19 woes

It bears noting that IP flexibilities are not limited to the use of compulsory licenses for local manufacturing. For example, the TRIPS Agreement, the most comprehensive multilateral agreement on intellectual property, allows a country with no sufficient logistical capabilities to gain access to finished products by asking another country to manufacture the medicine in its stead. The Intellectual Property Office of the Philippines (IPOPHL) and the Department of Health recently issued draft guidelines on how to avail of so-called special compulsory licenses which would pave the way for this type of manufacturing.

We may also pursue parallel importation and purchase medicines at lower rates. The Cheaper Medicines Act allows us to import medicine from countries with low-cost manufacturers, instead of buying directly from patent owners.

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ANALYSING THE INTERPLAY BETWEEN THE RIGHT TO HEALTH AND PHARMACEUTICAL PATENT RIGHTS IN THE INTRODUCTION OF A COVID-19 VACCINE INTO THE PHILIPPINES

By Mario C. Cerilles, Jr. and Harry Gwynn Omar M. Fernan

The road to a COVID-19 vaccine is complex. The Philippines is governed by an intellectual property system that has been accused of institutional problems such as slow registration procedures (Barizah, 2017). There is therefore a need to explore ways through which a COVID-19 vaccine can be made readily accessible without violating the constraints set by the governing patent system. The paper seeks to accomplish this by tracing the conflict between the right to health and patent law, applying the flexibilities for patents, and analysing policies during the pandemic. Posted below is a summary of our findings:

  1. I. FINDINGS
  3. A. Purchase from Patent Holder

The Philippines may purchase a COVID-19 vaccine from innovator pharmaceuticals or governments holding patent rights on a vaccine. However, this route may be costly. Notably, U.S. based company Moderna made deals with some countries for its experimental coronavirus vaccine for prices that range between $32 to $37 per dose (NPR.org, 2020). Using this estimate, the Philippines will have to spend more than Php 150 billion in order to vaccinate its population of more than 100 million. This figure is already equivalent to the entire budget of the country’s health department (Department of Health, 2020).

B. Parallel Importation

The country may also import from countries selling COVID-19 vaccines at a lower price. Leading pharmaceutical companies are already farming out the production of vaccines to India and China. For instance, The Serum Institute of India, the world’s largest supplier of vaccines to developing countries, is currently developing the vaccine candidates of AstraZeneca, Novavax, and Codagenix (Blankenship, 2020). Considering the low production costs in these countries (Lomas, 2017), the vaccines produced therein could cost much less than those in other countries. Nevertheless, it must be noted that pharmaceutical companies may still prevent licensees from exporting COVID-19 vaccines to the Philippines through contractual restrictions.

C. Compulsory licensing through local manufacturing

The Philippines is still in the process of developing its local vaccine manufacturing capability. In fact, the government has allocated Php 284 million in its 2021 budget for the development of a virology institute (Venzon, 2020). However, despite these initiatives, the Philippines still has no established vaccine manufacturing capability (Venzon, 2020). It has to enlist the help of other countries or pharmaceutical companies in the production of an effective COVID-19 vaccine. Notably, Russia previously offered to co-manufacture its COVID-19 vaccine in the Philippines (Reuters, 2020). To pursue this, the Philippines will have to procure a voluntary license or a compulsory license from the patent owner of the vaccine (TRIPS Agreement, 2017).

D. Compulsory licensing under Article 31bis of the TRIPS Agreement

Taking into account its depleted funds and limited capability in manufacturing vaccines, the Philippines may also opt to file a compulsory license to allow the importation of generic COVID-19 vaccines. Unlike parallel importation under the Cheaper Medicines Act which allows the entry of patented products that are produced and marketed elsewhere without the need for a compulsory license (Roma Drug vs. RTC, 2009), this process requires a voluntary or compulsory license (2008). Under this rule, a country like the Philippines which holds limited or no manufacturing capability, may apply for a compulsory license to import a generic version of the patented product in order to supply the needs of its domestic market (TRIPS Agreement, 2017).

E. Challenges for Flexibilities

i. Limited Supply and Production

Although flexibilities make it easier for developing countries like the Philippines to secure potential COVID-19 vaccines, there is a possibility that they may not even come into operation. There is uncertainty as to whether there will be enough vaccines to cater to the global population. Manufacturers have already expressed concern about the lack of raw materials for novel COVID-19 vaccines (Jingyi & Yeping, 2020). Initiatives like the COVAX facility could enable the country to secure potential vaccines, albeit in limited amounts, in the event that flexibilities end up not being immediately implemented (Gavi, 2020).

ii. Outdated Rules

Even assuming that enough vaccines are produced, it remains to be seen if the Philippines will be able to implement the flexibilities properly during the pandemic. To illustrate, as of writing, the Philippine government does not yet provide a clear procedure for special compulsory licenses for the importation of drugs and medicines. Fortunately, the IPOPHL and the DOH recently released an initial set of guidelines  (Draft Adminstrative Order, 2020) that could speed-up the process for compulsory licensing and lower the prices of medicine.

II. COVID-19 and Emergency Powers

            The government’s response to the current pandemic gives us an idea on how the government will attempt to balance the right to health and pharmaceutical patent rights. The Duterte administration has invoked the right to health as basis for a number of recent controversial policies. To illustrate, the Bayanihan to Heal as One Act (2020) has reportedly paved the way for the warrantless arrest of government critics (Conde, 2020). The government also curtailed the right to travel as it temporarily suspended the deployment of health workers to other countries (Governing Board Resolution No. 09 Series of 2020, 2020). These instances show that the government might not hesitate to sacrifice intellectual property rights in favour of public health.

III. CONCLUSION

For the Philippines to obtain access to a potential vaccine at the fastest possible time and at the most adequate amounts, it should utilize the flexibilities allowed by intellectual property laws. At the same time, it has to brace itself for the consequences of availing these flexibilities (e.g.  sanctions and payment of royalties). The country should also think long-term and start enhancing itsR&D capabilities.Most importantly, it has to cultivate the support of an engaged citizenry that is vigilant of government responses to public health issues.

Note: The article above is a summarized version of the conceptual paper which was published in the International Journal of Human Rights in Healthcare last 5 March 2021. You may access the full article here: https://www.emerald.com/insight/content/doi/10.1108/IJHRH-09-2020-0075/full/html

If you have comments or questions, please feel free to e-mail the authors at inquiry@cfiplaw.com

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Why—or why not—Cha-cha?

Cha-cha, or Charter change, has always been a controversial subject. A survey conducted in mid-2018 revealed that majority of Filipinos were against amending the Constitution, and this unpopularity may have historical underpinnings. Many Filipinos still recall how former President Ferdinand Marcos passed the 1973 Constitution through a haphazard process that what was widely viewed as an attempt to prolong his stay in power. This move gained even more notoriety as the Supreme Court upheld the document’s validity in the landmark case of Javellana vs Executive Secretary. Marcos was eventually deposed, but the negative perceptions of Cha-cha continued, plaguing many outgoing presidents from Gloria Macapagal-Arroyo to Benigno Aquino III.

Read more: https://opinion.inquirer.net/137209/why-or-why-not-cha-cha#ixzz6oV7QzVpt

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Do you have to pay whenever you play Christmas songs in public?

With the holidays fast approaching, we are once again exposed to familiar songs that warm our Christmas-loving hearts. Nowadays, it is not uncommon to catch Mariah’s All I Want for Christmas is you, Britney’s My Only Wish (This Year), and Jose Mari Chan’s Christmas in our Hearts (and uhm, a bunch of his other songs), playing in our favourite malls, stores and restaurants. 

To many customers, listening to Christmas songs is a pleasant experience. And if you happen to own a store, it is tempting to play these songs in order to attract visitors. After all, studies show that listening to certain songs could affect purchasing behaviour.[1] However, how do you know if a song could be played to the public, free-of-charge?

I. Applicable Laws

Songs are covered by copyright. Our law treats musical compositions as original intellectual creations that are protected from the moment of creation.[2] For instance, song composers hold exclusive rights to public performances of their works.[3] Performers, producers of sound recordings and broadcast organizations also hold other exclusive rights over the publication of their respective works.[4] As a consequence, an establishment may have to secure licenses and pay royalties in the form of license fees in order to play copyrighted songs in public.[5] Failure to do so may result in a finding of infringement, which entails imprisonment for one to three years and payment of a fine ranging from P50,000 to P150,000 for the first offense alone.[6]

II. Exceptions

It must be noted, however, that the Intellectual Property Code lists down a number of limitations to this rule. Some acts are not considered as infringement. An example is where the recitation or performance is made strictly for a charitable institution and involves a work that has previously been lawfully made accessible to the public.[7] There is also no infringement where the use of copyrighted works amounts to fair use, as when a song is played in public for purposes like research, criticism and teaching.[8]  Notably, a recent case decided by the Court of Appeals went further and held that certain food service and drinking establishments that have  limited areas, seating capacities and speakers, are exempted from paying license fees.[9] It remains to be seen, however, whether the Supreme Court will adopt this ruling.

III. Public Domain

Most importantly, not all songs are subject to copyright. In a case, the Supreme Court held that although playing the combo in a restaurant for the purpose of entertaining and amusing customers are acts constitutive of performance for profit as contemplated by our Copyright Law, there can be no infringement if the songs played form part of the public domain.[10] Songs, whose copyright protection have already expired, move to the public domain and may henceforth be played and performed in public without liability.[11] Examples of these are Christmas classics like Jingle Bells, We Wish You a Merry Christmas and Silent Night.[12] In the Philippines, copyright protection over a work generally extends until 50 years after the author’s death.[13]

In summary, if you wish to impart the Christmas vibe to your customers, it would be wise to apply for the necessary licenses or to simply choose songs that are available in the public domain. Better yet, why not create your own Christmas jingles?

For questions regarding this article, please email us at inquiry@cfiplaw.com.

Note: The article above is for informational purposes only and does not constitute legal advice.

[1] https://www.psychologistworld.com/behavior/ambient-music-retail-psychological-arousal-customers.

[2] Sec. 172.1 (f) IP Code (1997).

[3] Sec. 177.6 IP Code (1997).

[4] Secs. 203, 208, 211 IP Code (1997).

[5] https://filscap.org/frequently-asked-questions/.

[6] Secs. 217.1 (a) IP Code (1997).

[7] Sec. 184.1 IP Code (1997).

[8] Sec. 185.1 IP Code (1997).

[9] https://www.manilastandard.net/lgu/luzon/237697/ca-upholds-ruling-vs-filscap.html.

[10] Filipino Society of Composers, Authors and Publishers, Inc. vs Benjamin Tan, G.R. No. L-36402.

[11] https://www.ipophil.gov.ph/news/how-to-perform-and-play-songs-in-public-the-legal-way/.

[12] https://library.osu.edu/site/copyright/2018/12/21/public-domain-christmas-songs/.

[13] Sec. 213.1 IP Code (1997).

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Protecting Your Product Design

Did you recently create your own furniture, or accessories? Perhaps you handcrafted your own bags and shoes? If so, your creations are covered by industrial design, copyright, or trademark.

Industrial Design (or Design Patent)

A new and ornamental design may be registered as an industrial design.[1] Such registration entitles you to the exclusive use of the design for as long as fifteen years.[2] Industrial design registration can protect the designs of handicrafts, jewelries and computer components, among others.[3]

Patent or Utility Model 

Meanwhile, a design that pertains primarily to the functional aspect of a product, as opposed to being mere ornamentation, may be registered as an invention or a utility model. For example, a chair that is ergonomically designed to make long hours of sitting more comfortable may only be registered as an invention[4] or a utility model[5] even if its design also looks aesthetically pleasing. However, if the design serves as mere ornamentation (e.g., carvings or paintings on the chair’s legs) an industrial design registration is applicable.

Copyright Protection (Work of Applied Art)

A “work of applied art” is an artistic creation having utilitarian functions that are incorporated in a useful article.[6] Original ornamental designs or models for articles of manufacture, even if registrable as industrial designs, are entitled to copyright protection.[7] A useful article, however, may be copyrighted only to an extent where its pictorial, graphic, or sculptural features could be identified separately from its functional aspects. [8]

In 2019, the Taiwan IP Court ruled that Céline and Givenchy handbag designs are not copyrightable because they are primarily functional and they lack some required artistic features.[9] This is consistent with a past decision by our Supreme Court which recognized copyright protection only to works of applied art that have aesthetic features which are separable from its utilitarian aspects.[10]

Three-Dimensional Mark or Trade Dress

A product design may also be protected by a trademark. A mark is any visible sign capable of distinguishing products including a stamped or marked container of goods.[11] A sachet of a coffee, a bottle of a beer, and even the overall shape and appearance of a chocolate, even if registrable as industrial designs, may be registered as trademarks. Below are examples of three-dimensional marks or containers which have been registered as trademarks in the Philippines:

[12]        [13][14]

Summary

Product design is a complex process that involves artistic and functional consideration. New product designs may be protected by industrial design, patent, utility model, copyright, and trademark. You just need to identify the kind of protection that best suits your needs.

For questions regarding this article, email us at inquiry@cfiplaw.com.

Note: The article above is for informational purposes only and does not constitute legal advice.

[1] Sec. 113.1, IP Code (1997).

[2] Sec. 118, IP Code (1997).

[3] Sec. 113.3, IP Code (1997).

[4] An invention patent requires that an additional requirement of inventiveness or non-obviousness.

[5] Sec. 113.2, IP Code (1997).

[6] Sec. 171.10, IP Code (1997).

[7] Sec. 172.1 (h), IP Code (1997).

[8] Ching vs. Salinas, G.R. No. 161295, 29 June 2005.

[9] https://www.mondaq.com/patent/875930/can-a-bag-design-be-copyrighted

[10] Ching vs. Salinas, G.R. No. 161295, 29 June 2005.

[11] Sec. 121.1, IP Code (1997).

[12] Trademark Registration No. 14479 in the name of Elite Gold Ltd.

[13] Trademark Registration No. 123914 in the name of AB Heineken Philippines Inc.

[14] Trademark Registration No. 41997123133 in the name of Mondelez Europe GmbH.

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Are those secret recipes protected?

Among the consequences of the ongoing community quarantine is the avalanche of home-baked goods that suddenly became available at our doorsteps. As our favourite restaurants closed down, talented chefs and bakers strived to continue satisfying our food cravings. However, do you ever wonder if the secretly kept recipes for these goods are protected from copycats? Let us explore ways by which our laws protect those recipes:

  1. Trade Secrets and Contracts

We believe that secret recipes may fall under the category of “trade secrets”. Trade secrets include secret formulas or non-patented processes, used in the creation of commercially valuable products, which are known only to the individuals using them.[1] Relatedly, our Intellectual Property Code (IP Code) explicitly mentions the protection of undisclosed information. However, it does not prescribe specific means by which to protect such information.

One way to protect recipes from third parties is through contracts such as non-disclosure agreements. These are particularly helpful for restauranteurs whose staff members regularly handle secret recipes. Notably, laws such as the Philippine Competition Act and the Consumer Act of the Philippines have effectively recognized the validity of agreements that protect trade secrets.[2]

  1. Patent or Utility Model (UM)

Theoretically, patents could be used to protect recipes. However, due to strict requirements,[3] they are often availed of only by scientists and food technologists.  To begin with, it must be shown that a recipe involves a step that will result to non-obvious results.[4] However, many recipes do not satisfy this requirement. Merely adding sugar to a cookie recipe, for instance, is expected to make the cookie sweeter and, is therefore not patentable. Similarly, applying for a UM would be a challenge due to the requirement of novelty.[5] For recipes to be registrable as UMs, they should be new, or they should not have been previously made available to the public.[6] Unfortunately, most recipes are obvious variations of past recipes.

  1. Copyright

A U.S. Court once considered recipes that were attached to a food product, as original compositions that were copyrightable.[7] However, the strength of this decision has waned over the years and a recent decision has held that a recipe that is not accompanied by substantial literary expression is not copyrightable.[8] In either case, copyright protection extends only to the recipe as expressed on a certain medium (i.e., paper). It does not prevent anyone from following a recipe and replicating a certain food product, making one wonder if disclosing the recipe in a cookbook is even advisable.[9]

  1. Trademarks

Trademarks do not protect recipes. However, they could be used to protect the packaging for goods.[10] Considering that some food packages are so unique that they become synonymous with famous goods (think Toblerone), trademarks remain very useful to business owners.

Currently, there are calls to give ample protection to trade secrets through the enactment of a comprehensive trade secret law. It is unclear, however, whether this will ever happen. In the meantime, we just have to rely on other remedies.

For questions regarding this article, please email us at inquiry@cfiplaw.com.

Note: The article above is for informational purposes only and does not constitute legal advice.

[1] Air Philippines Corporation vs. Pennswell, Inc., G.R. No. 172835

[2] R.A. 10667, Section 15(e)(2)

[3] https://www.uspto.gov/learning-and-resources/newsletter/inventors-eye/can-recipes-be-patented

[4] Intellectual Property Code, Section 26

[5] Intellectual Property Code, Section 109.1

[6] Intellectual Property Code, Section 23

[7] Fargo Mercantile Co. v. Brechet & Richter Co., 295 F. 823 (8th Cir. 1924)

[8] Barbour v. Head, 178 F. Supp. 2d 758 (S.D. Tex. 2001)

[9] https://www.bradley.com/insights/publications/2019/07/intellectual-property-protection-for-recipes

[10] https://cfiplaw.com/2020/10/can-your-trademark-be-registered/; Sec. 121, IP Code of the Philippines.

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