INTELLECTUAL PROPERTY RIGHTS ISSUES
                                                 WITHIN THE R               T D MODEL CONTRACT (                            COST
                                                 REIMBU       RSEMENT)

                                                 This brochure is aimed at helping anyone preparing proposals for RTD
                                                 projects or anyone already subject to a contract to understand the rules,
                                                 and their rights and obligations related to IPR and the dissemination and
FIFTH FRAMEWORK PROGRAMME                        use of research results , as set out in the model contract.

                                                 The philosophy of European Research and Technological Development
                                                 (RTD) projects is simple: each partner might contribute to pre-
                                                 existing know-how, financial resources, and other resources. The
                                                 Community contributes financial help, in this type of contract generally up
                                                 to 50% of the eligible project costs. Contract partners have the right to own
                                                 the research results they generate, and the obligation to protect and use
                                                 or disseminate these results.

                                                 The Fifth Framework Programme*, together with the
                                                 corresponding rules covering project participation and the
                                                 dissemination of research results, makes it necessary to outline the
                                                 principles and main contractual obligations of participants or prospective
                                                 participants in EU supported RTD projects.

                                                    This leaflet only offers an overview. It is not intended to be exhaustive,
                                                    nor is it to be considered as legally binding, or in any way to replace
                                                    the regulatory documents and the model contract itself.

                                                    The information provided does not necessarily reflect the official
                                                    position of the European Commission.

  Intellectual Property Rights Issues within
the Community Research and Technological
           Development          Model Contract
                (Cost Reimbursement)

                                                  * Fifth Framework Programme: OJ L 26 of 1.2.1999 p.1. and Specific Programmes:
               Understanding the Rules on         OJ L 64 of 12.3.1999 p.1.
           Contractors’ Rights and Obligations

                                                                                        TYPES OF PARTNERS
 Pre-existing know-how (ex “Background”) is the information necessary to carry          P r i n c i p a l c o n t r a c t o r s are participants (legal entities, international
 out a project (excluding knowledge generated in the project), which is held by         organisations, or the Joint Research Centre - “JRC”), other than an assistant
 principal or assistant contractors before the project starts. It is also information   contractor, taking part in a project by virtue of the conclusion of a RTD contract
 acquired in parallel to the project, as well as copyright, patents, utility models,    and have the rights and obligations provided for in the contract.
 designs and models, plant variety rights, additional certificates, or other similar    The project coordinator must come from among principal contractors and is
 forms of protection, and any applications relating to such rights.                     subject to supplementary rights and obligations towards the Commission. It is in
 In short, pre-existing know-how covers both information and the rights deemed          charge of the scientific, financial and administrative coordination of the project.
 necessary for the project, which are owned or acquired by the contractors
 before the project has begun, or in parallel with it.                                  Assistant contractors are participants (legal entities, international
                                                                                        organisations or the JRC) taking part in a project by virtue of the conclusion of a
 Knowledge (ex “Foreground”) is the results, including information, obtained            RTD contract and act under the technical supervision of one or more
 under any project within the Fifth Framework Programme, as well as                     principal contractors and have the same rights and obligations as them, except
 copyright, patents, designs and models, plant variety rights, additional               with regard to the scope of their responsablility for the execution of the project
 certificates or other similar forms of protection, and any applications for            (they are responsible solely for the sections of research work they are carrying
 such rights.                                                                           out), and access rights (they only benefit from limited access rights).
 In other words, it is the new information and rights which contractors acquire from
 any project under the Fifth Framework Programme.                                       Subcontractors are third parties (legal entities, international organisations or
                                                                                        the JRC) providing services or goods, who have entered into a subcontract.
 Access rights are licences (non-exclusive but exceptionally also exclusive) as
 well as user rights with regard to knowledge and pre-existing know-how.                Complementary contractors are third parties (legal entities, international
                                                                                        organisations or the JRC) who have entered into a complementary contract.
 Financial conditions for granting access rights can be on:
                                 -Royalty-free basis : there are no costs (free of      USE, EXPLOITATION, DISSEMINATION, AND
                                -Favourable conditions: conditions that have a          THE TECHNOLOGICAL IMPLEMENTATION
                                  value lower than commercial (market) conditions.      PLAN
                                -Market conditions: open market conditions.
                                                                                        U s e is the direct or indirect use of knowledge in research activities or for
                                                                                        e x p l o i t a tion purposes.
  An RTD contract is an agreement concluded between principal contractors,              E x p l o i t a t i o n is the direct or indirect use of knowledge for creating and
  assistant contractors, and the European Community to carry out an RTD                 marketing a product or process, or for creating and providing a service.
                                                                                        D i s s e m i n a t i o n is the disclosure of knowledge for the promotion of scientific
  A subcontract is an agreement for the provision of goods or services                  and technical progress, with the exception of publication resulting from
  concluded between a participant in the RTD contract and a subcontractor for the       formalities related to knowledge protection.
  specific needs of the project.
                                                                                        The Technological Implementation Plan (TIP) is a report produced by the
  A complementary contract is an agreement concluded with the European                  contractors containing a summary of the project, a description of their
  Community, for work technically related to the RTD project and recognised as          achievements, and a forecast of their intentions regarding the use of knowledge.
  such by the participants in each contract.

  A consortium agreement is one or more agreements concluded between
  participants, which aims to specify or supplement the provisions of the RTD
  contract, without conflicting with it.
THE           EC TREATY

The Council Decision 1999/65/EC of 22 December 1998
concerning the rules for the participation of undertakings, research
c e n t r e s a n d u n i v e r s i t i e s a n d f o r t h e d i s s e m i n a t i o n of
research results for the implementation of the Fifth Framework
P r o g r a m m e of the European Community (1998-2002) (OJ L
2 6 o f 1.2.1999 p.46);

The Commission Regulation (EC) No 996/1999 of 11 May 1999 on
the implementation of the Council Decision 1999/65/EC
concerning the rules for the participation of undertakings, research
centres and universities and for the dissemination of research results
for the implementation of the Fifth Framework Programme of the
European Community (1998-2002) (OJ L 122 of 12.5.1999 p. 9);

The model contract, including the general rules relating to
intellectual and industrial property, publicity, and confidentiality
contained in Annex II Part B of this contract.

                 THE EURATOM TREATY

               Articles 12-29 of the Euratom Treaty implemented by:

The Council Decision 1999/66/Euratom of 22 December 1998
concerning the rules for the participation of undertakings, research
centres and universities in the implementation of the Fifth Framework
Programme of the European Atomic Energy Community (Euratom)
(1998-2002) (OJ L 26 of 1.2.1999 p. 56);

The Commission Regulation (Euratom) No 1605/1999 of 22 July 1999
on the implementation of Council Decision 1999/66/Euratom
concerning the rules for the participation of undertakings, research
centres and universities for the implementation of the Fifth Framework
Programme of the European Atomic Energy Community (Euratom)
(1998-2002) (OJ L 190 of 23.7.1999 p. 3).
OWNERSHIP OF PRE-EXISTING                                                             ACCESS RIGHTS TO PRE-EXISTING
KNOW-HOW                                                                              KNOW-HOW AND KNOWLEDGE

Each partner may bring in know-how which was
previously or concurrently acquired outside the project
a n d i s d e e m e d n e c e s s a r y f o r c a r r y i n g i t o u t . This pre-   Access rights to pre-existing know-how and knowledge w i l l
existing know-how will always remain the property of the                              be given to RTD contractors.
partner in question.                                                                  Such rights can be granted free of charge, under preferential
                                                                                      conditions, or under market conditions (see table of access rights below),
                                                                                      according to the type of partner (principal contractors or
                                                                                      assistant contractors) and the use to which this knowledge will be
                                                                                      put (to carry out the project, or for its use or dissemination).
Knowledge resulting from a RTD project i s t h e p r o p e r t y o f
the principal contractors and assistant contractors who                               As a general principle, access rights are granted on a
have generated that knowledge.                                                        non-exclusive basis but the holder may, as an exception, grant
                                                                                      exclusive access rights to their knowledge for exploitation
In the case where knowledge is generated by several contractors, an                   purposes at market conditions. This exception should apply when
agreement shall be made concerning ownership of these results and                     economically essential, in particular taking into account the market,
the use of these property rights (for example in a consortium                         the risks involved, and the investment required to exploit the
agreement).                                                                           knowledge. It should also comply with competition rules.

The ownership of knowledge can be transferred, subject to                             In such cases, the holder must inform the other contractors in due time
agreements transferring all related obligations resulting from a RTD                  about the requesting party and of the proposed arrangements for
model contract, and complying with i nternational agreements                          granting such rights.
concluded by the Community. A transfer notification, specifying the
terms and conditions must be made to the rest of the contracting                      Principal contractors may object to the concession of such exclusive
parties prior to concluding the agreement.                                            rights, indicating their commitment to exploit the knowledge on the basis
                                                                                      of non-exclusive access rights within 30 days of receipt of such

                                                                                      The holder of the rights is entitled to refuse access rights for the
                                                                                      exploitation of knowledge if it intends to exploit the knowledge
                                                                                      itself, but only if it is economically essential to do so, taking into
                                                                                      account the market, the risks involved, and the investments required.

                                                                                      The act of granting exclusive access rights or the refusal to do so does
                                                                                      not affect the obligation to grant access rights to the requesting party for
                                                                                      the use of its own knowledge.

                                                                                      The holder of these rights is entitled to grant them under more
                                                                                      favourable financial conditions . Within a consortium agreement it will
                                                                                      always be possible to grant additional access rights or to complement the
                                                                                      access right conditions.
                                                                                 ?   IF I AM UNABLE TO EXPLOIT THE KNOWLEDGE

                                                                                     WHICH I GENERATED WITHIN A PROJECT, WHAT CAN I DO?

The length of time during which access rights can be requested                         In this case, you may decide to grant access rights to this
will depend on the status of the principal contractor or assistant                     knowledge to the principal contractors for their exploitation,
contractor engaged in the same project, or the principal contractor                    not free of charge but under financial conditions corresponding
of another project within the same specific programme.                                 to your contribution to the project, and to the potential of this


     A longer term can be agreed upon in the technological implementation plan
  ARE ACCESS RIGHTS GRANTED AUTOMATICALLY?                                       ?
               No, they are only granted on request .
                                                                                 ?                  ARE THERE ANY LIMITATIONS TO
                                                                                                    THE GRANTING OF ACCESS RIGHTS?

                                                                                 ?    Yes, there are limitations.

                                                                                      The concession of these rights can be made subject to the conclusion

                                                                                 ?    of agreements about the intended purpose of using these rights and to

                                                                                      Furthermore, the concession of access rights for pre-existing know-how

                                                                                 ?    will only be possible if the holder of these rights is free to do so.

                  OBLIGATION TO PROTECT                                                                                       OBLIGATION TO USE OR DISSEMINATE

                                                                                                                               The aim of the rules on use and dissemination of research results is to ensure
                 The contractors have to protect knowledge capable of industrial or
                                                                                                                               that the benefits of EU-supported RTD are used as widely as possible for the
                 commercial application in an adequate and effective manner and for an                                         economic and social benefit of Europe's industry and society.
                 appropriate period of time . The details of how the knowledge is or has been
                 protected* must be defined in the technological implementation plan.                                          T h e c o n t r a c t o r s a r e r e q u i r e d , within a reasonable period of time and
                                                                                                                               in accordance with the interests of the Community:
                 If the contractors do not intend to protect knowledge capable of
                 protection in a particular country, the Commission may, after                                                           to use results which they own either in further research activities or for
                 agreement with the contractors, take over their contractual obligations.                                                exploitation purposes or alternatively to ensure that effective use is
                                                                                                                                         made of any knowledge according to the principles and timetable
                 A contractor may publish or allow the publication of data concerning the                                                set out in the TIP; or
                 knowledge they have acquired in the course of the contract, only if the
                 disclosure does not affect the protection of the knowledge , and always                                                 otherwise to disseminate the knowledge if it is not to be used either
                 subject to prior consultation and with the agreement of the other                                                       by exploitation or research. The contractors, when disseminating, must
                 contractors.                                                                                                            always respect:
                                                                                                                                         - the need to safeguard intellectual and industrial property rights;
                                                                                                                                         - confidentiality;
                  DOES COMMUNITY FUNDING COVER THE PROTECTION COSTS OF                                                                   - the legitimate interests of the other contractors.
                                                                                                                               If the contractors fail to use or disseminate the knowledge, the Community may
                                                                                                                               disseminate it by any appropriate means.
                              Yes, under the Fifth Framework Programme, the protection costs of
                              knowledge generated by the project can be eligible for Community
                                                                                                                               PRODUCTION OF A TECHNOLOGICAL
                              funding under certain conditions. These include the prior
                                    written approval of the Commission, and conformity with                                    IMPLEMENTATION PLAN (TIP)
                                        competition rules.
                                                                                                                               The contractors must produce a technological implementation plan as a tool for
                                                                                                                               ensuring adequate IPR management and for monitoring the obligation to use or
                                             These costs will cover:
                                                                                                                               disseminate their knowledge. This plan:
                                              - costs of documentary research preliminary to the
                                                filing of an application for the granting of an                                                    must be submitted to the Commission no later than two
                                                 industrial property right;                                                                        months after the end of the duration of the project;
                                                   - fees paid to relevant author ities, which are
                                                 necessary with a view to the granting of                                                          must reflect the broad outlines of the plan for dissemination
                                                an industrial property right, for its territorial                                                  and use submitted and evaluated as part of the original
                                               extension (provided that a preliminary documentary                                                  proposal;
                                             research has been carried out), or for the extension of
                                                                                                                                                   must include a summary of the project, a description of the
                                           the duration of an industrial property right;
                                                                                                                                                   achievements, and a forecast of the intentions of the
                                         - fees paid to advisers (internal or external) with a limit of                                            contractors, as to how the knowledge is to be used or
                                    4,000 EUR in respect of each industrial property right, provided                                               disseminated;
                              that an application for the granting of an industrial property right has
                              been subsequently filed.                                                                                             must justify any subsequent changes in the initial
                                                                                                                                                   dissemination and use plan that significantly alters
                              Costs excluded are:                                                                                                  the conditions of dissemination and use;
                              - translation costs,
                              - costs to obtain access rights.                                                                            requires approval from the Commission.
*   Details of the precise form the protection of research results will take is left to the contractors.              DO I HAVE ANY OTHER OBLIGATIONS?
    The various existing legal protection instruments may be used. It should be borne in mind that depending on the
    nature of the results, the use of a protection system or the combination of several different types of
                                                                                                                      Yes, as in previous Framework Programmes, the contracting parties commit themselves to
    protection systems for property rights could be chosen. These can be patents or utility models, industrial
    designs, trade marks and other distinctive signs, copyright, and other types of protection such as plant          carrying out the work listed in the work programme annexed to the contract, and to
    varieties rights, additional certificates, or other similar forms of protection.                                  providing the Commission with detailed activity reports and cost statements.

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