INTELLECTUAL PROPERTY CODE

Laws governing intellectual property:

• R.A. No. 8293 - Intellectual Property Code of the Philippines;
Enacted - June 6, 1997;
• Effectivity - January 1, 1998
• Non-Retroactive

• R.A. No. 10372 – Act amending certain provisions of R.A. No. 8293; approved February 28
2013;

INTELLECTUAL PROPERTY RIGHTS IN GENERAL

Intellectual property right, defined: (Section 4.1, Intellectual Property Code)

The term “intellectual property rights" consists of:

• Copyright and Related Rights;
• Trademarks and Service Marks;
• Geographic Indications;
• Industrial Designs;
• Patents;
• Layout-Designs (Topographies) of Integrated Circuits; and
• Protection of Undisclosed Information

Differences between patent, trademark and copyright:

• Patent is granted to provide rights and protection to the inventor after an invention is disclosed to the
public. (E.I Dupont De Nemours and Co. vs. Dir. Francisco, GR 174379, 2016) Patentable inventions,
refer to any technical solution of a problem in any field of human activity which is new, involves an
inventive step and is industrially applicable. Ibid

• By the nature of things, there can be no unfair competition under the law on copyrights although it is
applicable to disputes over the use of trademarks. (Pearl & Dean, Inc. vs. ShoeMart Inc., G.R. No. 148222, August
15, 2003)

• The description of the art in a book, though entitled to the benefit of copyright, lays no foundation
for an exclusive claim to the art itself. The object of the one is explanation; the object of the other is
use. The former may be secured by copyright. The latter can only be secured, if it can be secured at
all, by letters patent. (Pearl & Dean, Inc. vs. ShoeMart Inc., G.R. No. 148222, August 15, 2003)
•
• A trademark is any visible sign capable of distinguishing the goods (trademark) or services (service
mark) of an enterprise and shall include a stamped or marked container of goods. In relation thereto,
a trade name means the name or designation identifying or distinguishing an enterprise. (Kho vs. Court
of Appeals, G.R. No. 115758, March 19, 2002)

• Meanwhile, the scope of a copyright is confined to literary and artistic works which are original
intellectual creations in the literary and artistic domain protected from the moment of their
creation. Ibid

Reciprocity vs. Reverse Reciprocity Principle

 PRINCIPLE OF
RECIPROCITY RULE
REVERSE
RECIPROCITY
Any person who is a Any condition, restriction,
national or who is limitation, diminution,
domiciled or has a real requirement, penalty or
and effective industrial any similar burden
establishment in a imposed by the law of a
country which is a party foreign country on a
to any convention, Philippine national
treaty or agreement seeking protection of
relating to intellectual intellectual property right
property rights or the in that country, shall
repression of unfair reciprocally be
competition, to which enforceable upon
the Philippines is also a nationals of said country
party, or extends within Philippine
reciprocal rights to jurisdiction. (Section. 231,
nationals of the Intellectual Property Code)
Philippines by law shall
be entitled to benefits
to the extent necessary
to give effect to any
provision of such
convention, treaty or
reciprocal law, in
addition to the rights to
which any owner of an
intellectual property
right is otherwise
entitled by this Act.
(Section 3, Intellectual
Property Code)

PATENTS

Definition: A patent is granted to provide rights and protection to the inventor after an invention is
disclosed to the public. (E.I Dupont De Nemours and Co. vs. Dir. Francisco, GR 174379, 2016) Once an
invention is disclosed to the public, only the patent holder has the exclusive right to manufacture, utilize,
and market the invention. (Creser Precision Systems vs. CA 349 Phil. 687, 695 (1998)

Threefold Purpose
1. to foster and reward invention
2. promotes disclosure of inventions to stimulate further invention and to permit the public to
practice the invention once the patent expires
3. stringent requirements for patent protection seek to ensure that ideas in the public domain
remain there for the free use of the public.

Ultimate Goal: to bring new designs and technologies into the public domain through disclosure.

Prescriptive Period: 20 years without renewal. (Section 54, IPC)

Patentable invention, defined: (Section 21, Intellectual Property Code)

• Patentable inventions - Any technical solution of a problem in any field of human activity which is
(NII):
• new (Novelty);
The thing is not yet known to anyone besides the inventor. However, there are disclosures that
will not prejudice the application (Sec. 25, IPC) Invention shall not be considered new if it forms part of a
prior art. (Sec. 9, IPC )

• involves an iInventive step;

It should not be obvious not to the general public but to a person skilled in the art (Sec. 26, IPC)

Note: In the case of drugs and medicines, there is no inventive step if the invention results from the mere
discovery of a new form or new property of a known substance which does not result in the enhancement
of the known efficacy of that substance, or the mere discovery of any new property or new use for a known
substance, or the mere use of a known process unless such known process results in a new product that
employs at least one new reactant (as amended by Sec. 6 of RA 9502 “Universally Accessible Cheaper and
Quality Medicine Act of 2008)

• Industrially applicable;
It can be produced and used in any industry (Sec. 27, IPC)
It may be, or may relate to, a product, or process, or an improvement of any of the foregoing.

Non-patentable inventions (Section 22, Intellectual Property Code)

• Discoveries, scientific theories and mathematical methods,

In the case of drugs and medicines, the mere discovery of a new form or new property of a
known substance which does not result in the enhancement of the known efficacy of that
substance, or the mere discovery of any new property or new use for a known substance, or the
mere use of a known process unless such known process results in a new product that employs
at least one new reactant.

For this purpose of this caluse, salts, esters, ethers, polymorphs, metabolites, pure form, particle
size, isomers, mixtures of isomers, complezes, combination, and other derivatives of a known
substance shall be considered to be the same substance, unless they differ significantly in
properties with regard to efficacy; (as amended by Sec. 5 of RA 9502 “Universally Accessible Cheaper
and Quality Medicine Act of 2008)

• Schemes, rules and methods of performing mental acts, playing games or doing business, and
programs for computers;

• Methods for treatment of the human or animal body by surgery or therapy and diagnostic
methods practiced on the human or animal body. This provision shall not apply to products and
composition for use in any of these methods;

• Plant varieties or animal breeds or essentially biological process for the production of plants or
animals. This provision shall not apply to micro-organisms and non-biological and microbiological
processes.

• Aesthetic creations; and

 • Anything which is contrary to public order or morality.

OWNERSHIP OF A PATENT

Right to a patent (Section 28, Intellectual Property Code)

The right to a patent belongs to:

• the inventor,
• his heirs, or
• his assigns.

When two (2) or more persons have jointly made an invention, the right to a patent shall belong to them
jointly. (Section 28, Intellectual Property Code)

First-to-File Rule

If two (2) or more persons have made the invention separately and independently of each other, the
right to the patent shall belong to the person who filed an application for such invention, or where two or
more applications are filed for the same invention, to the applicant who has the earliest filing date or, the
earliest priority date. (Section 29, Intellectual Property Code)

Inventions created pursuant to a Commission or Employment

(Section 30, Intellectual Property Code)

If pursuant to Commission:

GR: The person WHO COMMISSIONS the work shall own the patent.

Xpn: Unless otherwise provided in the contract.

If pursuant to Employment contract. When an invention is made by an Employee in the course of his
employment contract, the patent shall belong to:

1. EMPLOYEE, if the inventive activity is NOT part of his regular duties even if the employee uses the
time, facilities and materials of the employer.

2. EMPLOYER, if the invention is the result of the performance of employee’s regular duties.
Xpn: unless there is an agreement, express or implied, to the contrary

Right of Priority
(Section 31, Intellectual Property Code)

An application for patent filed by any person who has previously applied for the same invention in
another country which by treaty, convention, or law affords similar privileges to Filipino citizens, shall be
considered as filed as of the date of filing the foreign application: Provided, That:
(a) The local application expressly claims priority;
(b) It is filed within twelve (12) months from the date the earliest foreign application was filed; and
(c) A certified copy of the foreign application together with an English translation is filed within six
(6) months from the date of filing in the Philippines. (Sec 31. IPC)

Thus, if in case there is an application filed in the Philippines and another filed in another country, and
the Philippine application was filed earlier than the other application, it is still possible that the foreign
application will be granted by virtue of Right of Priority as long as all the requisites are complied with
(Salao, Essential of Intellectual Property Law p68)

Grounds for cancellation of a patent

(Section 61, Intellectual Property Code)

Any interested person may, upon payment of the required fee, petition to cancel the patent or any claim
thereof, or parts of the claim, on any of the following grounds:

• That what is claimed as the invention is NOT new or patentable;

• That the patent does NOT disclose the invention in a manner sufficiently clear and complete for it to
be carried out by any person skilled in the art; or
• That the patent is contrary to public order or morality.

Remedy of the true and actual inventor

(Section 68, Intellectual Property Code)

If a person, who was deprived of the patent without his consent or through fraud is declared by final
court order or decision to be the true and actual inventor, the court shall:

• Order for his substitution as patentee, OR

• At the option of the true inventor, cancel the patent, and award actual and other damages in his
favor if warranted by the circumstances.

Rights Conferred by a Patent

(Section 71, Intellectual Property Code)

Product Process
exclusive right to to restrain, prevent
restrain, prohibit or prohibit any
and prevent any unauthorized person
unauthorized person or entity from using
or entity from the process, and
making, using, from manufacturing,
offering for sale, dealing in, using,
selling or importing selling or offering for
that product (Sec. sale, or importing
71.1[a]); any product obtained
directly or indirectly
from such process
(Sec. 71.1[b]).
Patent owners shall also have the right to
assign, or transfer by succession the patent,
and to conclude licensing contracts for the
same

Note: The owner does not only control the use of the process but also products obtained from such
process, even those that are obtained indirectly from the same process. (Salao, Essential of Intellectual
Property Law p85)

LIMITATION ON PATENT RIGHTS

• Those provided for under Article 72;

• Use by a prior user;
• Use by the government.
1. Under The owner of a patent has
Art. 72 as no right to prevent third
amended by parties from performing,
RA. 9502 without his authorization, the
“Universally acts referred to in Section
Accessible 71in the following
Cheaper and circumstances:
Quality
Medicine Act • Using a patented
2008” product which has been
put on the market in the
Philippines by the owner
of the product, or with
his express consent,
insofar as such use is
performed after that
product has been so put
on the said market;
Provided, that with
regard to drugs and
medicines, the limitation
on patent rights shall
apply after a drug or
medicine has been
introduced in the
Philippines or anywhere
else in the world by the
patent owner, or by any
party authorized to use
the invention: Provided,
further, that the right to
import the drugs and
medicines contemplated
in this section shall be
available to any
government agency or
any private thirds party;

• Where the act is done

privately and on a non-
commercial scale or for a
non-commercial purpose
Provided, that it does
not significantly
prejudice the economic
interests of the owner of
the patent

• Where the act consists

of making or using
exclusively for
 experimental use of the
invention for scientific
purposes or educational
purposes and such other
activities directly related
to such scientific or
educational experimental
use.

• In the case of drugs and

medicines, where the act
includes testing, using,
making or selling the
invention including any
data related thereto,
solely for purposes
reasonably related to the
development and
submission of
information and issuance
of approvals by
government regulatory
agencies required under
any law of the
Philippines or of another
country that regulates
the manufacture,
construction, use or sale
of any product:
Provided, That, in order
to protect the data
submitted by the original
patent holder from unfair
commercial use provided
in Article 39.3 of the
Agreement on Trade-
Related Aspects of
Intellectual Property
Rights (TRIPS
Agreement), the
Intellectual Property
Office, in consultation
with the appropriate
government agencies,
shall issue the
appropriate rules and
regulations necessary
therein not later than
one hundred twenty
(120) days after the
enactment of this law;

• Where the act consists

 of the preparation for
individual cases, in a
pharmacy or by a
medical professional, of
a medicine in accordance
with a medical
prescription or acts
concerning the medicine
so prepared;

• Where the invention is

used in any ship, vessel,
aircraft, or land vehicle
of any other country
entering the territory of
the Philippines
temporarily or
accidentally:
Provided, that such
invention is used
exclusively for the needs
of the ship, vessel,
aircraft, or land vehicle
and not used for the
manufacturing of
anything to be sold
within the Philippines.

2. Right of a Any prior user, who, in good

prior user faith was using the invention
or has undertaken serious
preparations to use the
invention in his enterprise or
business, before the filing
date or priority date of the
application on which a
patent is granted, shall have
the right to continue the use
thereof as envisaged in such
preparations within the
territory where the patent
produces its effect. (Section
73.1, Intellectual Property Code)

A prior user cannot assign

the right to use the patented
product or process without
giving up entirely his
enterprise. (Sec. 73.2, IPC)

3. Use by General Rule: The

the Gov’t government is bound to
 respect the patent.

Exception: A Government
agency or third person
authorized by the
Government may exploit the
invention even without
agreement of the patent
owner where:
• the public interest, in
particular, national
security, nutrition,
health or the
development of
other sectors, as
determined by the
appropriate agency
of the government,
so requires; or

• A judicial or
administrative body
has determined that
the manner of
exploitation, by the
owner of the patent
or his licensee, is
anti-competitive.
(Section 74, Intellectual
Property Code)

PATENT INFRINGEMENT:
The making, using, offering for sale, selling, or importing a patented product or a product obtained
directly or indirectly from a patented process, or the use of a patented process without the authorization
of the patentee (Sec. 76, IPC)

Note: This shall not apply to instances covered by Sec. 72.1 and 72.4 (Limitations of Patent
Rights); Sec. 74 (Use of Invention by Government); Sec. 93.6 (Compulsory Licensing); and Sec.
93-A (Procedures on Issuance of a Special Compulsory License under the TRIPS Agreement) of
the Intellectual Property Code (Sec. 9 of RA 9502)

Tests in Patent Infringement

1. Literal Infringement
2. Doctrine of Equivalents

Literal Infringement
• In using literal infringement as a test, resort must be had to the words of the claim. If accused
matter clearly falls within the claim, infringement is made out and that is the end of it. To determine
whether the particular item falls within the literal meaning of the patent claims, the court must
juxtapose the claims of the patent and the accused product within the overall context of the claims
and specifications, to determine whether there is exact identity of all material elements. (Godines vs.
Court of Appeals, G.R. No. 97343, September 13, 1993)

• In considering literal infringement, the patent's claims must be read in connection with patent's
specification and its file history, and the claims of patent cannot be given a construction broader than
the teachings expressed in the patent. (Studiengesellschaft Kohle mbH v. Eastman Kodak Company, 616 F. 2d 1315,
May 15, 1980)

Doctrine of Equivalents

• The doctrine of equivalents provides that an infringement also takes place when a device
appropriates a prior invention by incorporating its innovative concept and, although with some
modification and change, performs substantially the same function in substantially the same way to
achieve substantially the same result.(Smith Kline Corporation vs. Court of Appeals, G. R. No. 126627, August 14,
2003, citing Godines vs. Court of Appeals, G.R. No. 97343, September 13, 1993)

• The doctrine of equivalents recognizes that minor modifications in a patented invention are sufficient
to put the item beyond the scope of literal infringement. (Godines vs. Court of Appeals, G.R. No. 97343,
September 13, 1993)

• The reason for the doctrine of equivalents is that to permit the imitation of a patented invention
which does not copy any literal detail would be to convert the protection of the patent grant into a
hollow and useless thing. Such imitation would leave room for — indeed encourage — the
unscrupulous copyist to make unimportant and insubstantial changes and substitutions in the patent
which, though adding nothing, would be enough to take the copied matter outside the claim, and
hence outside the reach of the law. (Godines vs. Court of Appeals, G.R. No. 97343, September 13, 1993)

REMEDIES FOR INFRINGEMENT:

Civil action for infringement: (Section 76, Intellectual Property Code)

• Any patentee, or anyone possessing any right, title or interest in and to the patented invention,
whose rights have been infringed, may bring a civil action before a court of competent jurisdiction, to
recover from the infringer such damages sustained thereby, plus attorney’s fees and other expenses
of litigation, and to secure an injunction for the protection of his rights.

• If the damages are inadequate or cannot be readily ascertained with reasonable certainty, the court
may award by way of damages a sum equivalent to reasonable royalty.

• The court may, according to the circumstances of the case, award damages in a sum above the
amount found as actual damages sustained: Provided, That the award does not exceed three (3)
times the amount of such actual damages.

• The court may, in its discretion, order that the infringing goods, materials and implements
predominantly used in the infringement be disposed of outside the channels of commerce or
destroyed, without compensation.
• Anyone who actively induces the infringement of a patent or provides the infringer with a component
of a patented product or of a product produced because of a patented process knowing it to be
especially adopted for infringing the patented invention and not suitable for substantial non-infringing
use shall be liable as a contributory infringer and shall be jointly and severally liable with the
infringer.

Criminal action for repetition of infringement (Section 84, Intellectual Property Code)

If infringement is repeated by the infringer or by anyone in connivance with him after finality of the
judgment of the court against the infringer, the offenders shall, without prejudice to the institution of a
civil action for damages, be criminally liable therefore.

DEFENSES IN ACTION FOR INFRINGEMENT

1. Prescription
2. Notice requirement
3. Invalidity of patent

Prescriptive period of civil action:

No damages can be recovered for acts of infringement committed more than four (4) years before the
institution of the action for infringement. (Section 76, Intellectual Property Code)

Prescriptive period of criminal action

The criminal action herein provided shall prescribe in three (3) years from date of the commission of the
crime. (Section 84, Intellectual Property Code)

Notice requirement before damage can be recovered

Damages cannot be recovered for acts of infringement committed before the infringer had known, or had
reasonable grounds to know of the patent. It is presumed that the infringer had known of the patent if
on the patented product, or on the container or package in which the article is supplied to the public, or
on the advertising material relating to the patented product or process, are placed the words "Philippine
Patent" with the number of the patent. (Section 80, Intellectual Property Code)

Invalidity of patent as a defense in action for infringement

In an action for infringement, the defendant, in addition to other defenses available to him, may show
the invalidity of the patent, or any claim thereof, on any of the grounds on which a petition of
cancellation can be brought under Section 61 hereof. (Section 81, Intellectual Property Code)
Section 61. (a) That what is claimed as the invention is NOT new or Patentable;(b) That the patent
does NOT disclose the invention in a manner sufficiently clear and complete for it to be carried out by
any person skilled in the art; or (c) That the patent is contrary to public order or morality.

LICENSING

Types of licensing:

• voluntary
• compulsory

VOLUNTARY LICENSING
Granting authority to enterprises that can commercially exploit the invention, either by manufacturing,
distribution or retail selling. (Salao, Essential of Intellectual Property Law,
p101).
Purpose of voluntary license contract

To encourage the transfer and dissemination of technology, prevent or control practices and conditions
that may in particular cases constitute an abuse of intellectual property rights having an adverse effect on
competition and trade, all technology transfer arrangements shall comply with the provisions of this
Chapter. (Section 85, Intellectual Property Code)

Prohibited clauses, which have an adverse effect on competition and trade

(Section 87, Intellectual Property Code)

Except in cases under Section 91, the following provisions shall be deemed prima facie to have an
adverse effect on competition and trade:
• Those which impose upon the licensee the obligation to acquire from a specific source capital goods,
intermediate products, raw materials, and other technologies, or of permanently employing personnel
indicated by the licensor;

• Those pursuant to which the licensor reserves the right to fix the sale or resale prices of the products
manufactured on the basis of the license;

• Those that contain restrictions regarding the volume and structure of production;

• Those that prohibit the use of competitive technologies in a non-exclusive technology transfer
agreement;

• Those that establish a full or partial purchase option in favor of the licensor;

• Those that obligate the licensee to transfer for free to the licensor the inventions or improvements
that may be obtained through the use of the licensed technology;

• Those that require payment of royalties to the owners of patents for patents which are not used;

• Those that prohibit the licensee to export the licensed product unless justified for the protection of
the legitimate interest of the licensor such as exports to countries where exclusive licenses to
manufacture and/or distribute the licensed product(s) have already been granted;

• Those which restrict the use of the technology supplied after the expiration of the technology transfer
arrangement, except in cases of early termination of the technology transfer arrangement due to
reason(s) attributable to the licensee;

• Those which require payments for patents and other industrial property rights after their expiration,
termination arrangement;

• Those which require that the technology recipient shall not contest the validity of any of the patents
of the technology supplier;

• Those which restrict the research and development activities of the licensee designed to absorb and
adapt the transferred technology to local conditions or to initiate research and development programs
in connection with new products, processes or equipment;

• Those which prevent the licensee from adapting the imported technology to local conditions, or
introducing innovation to it, as long as it does not impair the quality standards prescribed by the
licensor;
• Those which exempt the licensor for liability for non-fulfilment of his responsibilities under the
technology transfer arrangement and/or liability arising from third party suits brought about by the
use of the licensed product or the licensed technology; and

• Other clauses with equivalent effects.

Exceptional cases:

In exceptional or meritorious cases where substantial benefits will accrue to the economy, such as high
technology content, increase in foreign exchange earnings, employment generation, regional dispersal of
industries and/or substitution with or use of local raw materials, or in the case of Board of Investments,
registered companies with pioneer status, exemption from any of the above requirements may be
allowed by the Documentation, Information and Technology Transfer Bureau after evaluation thereof on
a case by case basis. (Section 91, Intellectual Property Code)

Mandatory provisions in a voluntary license contract

(Section 88, Intellectual Property Code)

The following provisions shall be included in voluntary license contracts:

• That the laws of the Philippines shall govern the interpretation of the same and in the event of
litigation, the venue shall be the proper court in the place where the licensee has its principal office;

• Continued access to improvements in techniques and processes related to the technology shall be
made available during the period of the technology transfer arrangement;

• In the event the technology transfer arrangement shall provide for arbitration, the Procedure of
Arbitration of the Arbitration Law of the Philippines or the Arbitration Rules of the United Nations
Commission on International Trade Law (UNCITRAL) or the Rules of Conciliation and Arbitration of
the International Chamber of Commerce (ICC) shall apply and the venue of arbitration shall be the
Philippines or any neutral country; and

• The Philippine taxes on all payments relating to the technology transfer arrangement shall be borne
by the licensor.

Right of licensor to grant further licenses to third person to exploit the subject matter of the
technology

In the absence of any provision to the contrary in the technology transfer arrangement, the grant of a
license shall not prevent the licensor from granting further licenses to third person nor from exploiting the
subject matter of the technology transfer arrangement himself. (Section 89, Intellectual Property Code)

Rights of Licensee:

The licensee shall be entitled to exploit the subject matter of the technology transfer arrangement during
the whole term of the technology transfer arrangement. (Section 90, Intellectual Property Code)

COMPULSORY LICENSING
Situations where licenses are awarded againstthe will of the patent owner.

Grounds for compulsory licensing: (Section 93, Intellectual Property Code)

The Director of Legal Affairs may grant a license to exploit a patented invention, even without the
agreement of the patent owner, in favor of any person who has shown his capability to exploit the
invention, under any of the following circumstances:

• National emergency or other circumstances of extreme urgency;

• Where the public interest, in particular, national security, nutrition, health or the development of
other vital sectors of the national economy as determined by the appropriate agency of the
Government, so requires; or

• Where a judicial or administrative body has determined that the manner of exploitation by the owner
of the patent or his licensee is anti-competitive; or

• In case of public non-commercial use of the patent by the patentee, without satisfactory reason;

• If the patented invention is not being worked in the Philippines on a commercial scale, although
capable of being worked, without satisfactory reason: Provided, That the importation of the patented
article shall constitute working or using the patent.
• Where the demand for patented durgs and medicines is not being met to an adequate extent and on
reasonable terms, as determined by the Secretary of the Department of Health. (As amended by RA
9502)

Note: No. 5 should be applied before the expiration of a period of four (4) years from the date of
filing of the application or three (3) years from the date of the patent whichever period expires last.

Nos 2,3,4, and 6. may be applied for at any time after the grant of the patent. (Sec. 12 of RA 9502)

Compulsory license based on interdependence of patents

(Section 97, Intellectual Property Code)

If the invention protected by a patent, hereafter referred to as the "second patent," within the country
cannot be worked without infringing another patent, hereafter referred to as the "first patent," granted
on a prior application or benefiting from an earlier priority, a compulsory license may be granted to the
owner of the second patent to the extent necessary for the working of his invention, subject to the
following conditions:

• The invention claimed in the second patent involves an important technical advance of considerable
economic significance in relation to the first patent;

• The owner of the first patent shall be entitled to a cross-license on reasonable terms to use the
invention claimed in the second patent;

• The use authorized in respect of the first patent shall be non-assignable except with the assignment
of the second patent; and

• The terms and conditions of Sections 95, 96 and 98 to 100 of this Act.

ASSIGNMENT AND TRANSMISSION OF RIGHTS

Transmission of rights
Inventions and any right, title or interest in and to patents and inventions covered thereby, may be
assigned or transmitted by inheritance or bequest or may be the subject of a license contract. (Section
103.2, Intellectual Property Code)
Assignment of inventions
An assignment may be of the entire right, title or interest in and to the patent and the invention covered
thereby, or of an undivided share of the entire patent and invention, in which event the parties become
joint owners thereof. An assignment may be limited to a specified territory. (Section 104, Intellectual Property
Code)

Forms of assignment
The assignment must be in writing, acknowledged before a notary public or other officer authorized to
administer oath or perform notarial acts, and certified under the hand and official seal of the notary or
such other officer. (Section 105, Intellectual Property Code)

TRADEMARKS

DEFINITIONS, MARKS, COLLECTIVE MARKS, TRADE NAMES

MARK COLLECTIVE MARK

Any visible sign capable Any visible sign
of distinguishing the designated in the
goods (trademark) or application and capable
services (service mark) of distinguishing the
of an enterprise and origin or any other
shall include a stamped common characteristic,
or marked container. including the quality of
(Section 121.1, Intellectual goods or services of
Property Code) different enterprises
which use the sign under
the control of the
registered owner of
collection mark.(Section
121.2, Intellectual Property
Code)

Must be
registered.(Section 122, Must be
Intellectual Property Code) registered.(Sections 122,
167, Intellectual Property
Code)
TRADE NAME TRADE MARK
The name or Any visible sign capable
designation identifying of distinguishing goods or
or distinguishing an services of an
enterprise.(Section 121.3, enterprise.(Sec. 121,
Intellectual Property Code) Intellectual Property Code)

No need to register. Needs to be

(Section 165, registered.(Section 122,
Intellectual Property Intellectual Property Code)
Code)
Existence is separate
Designates and is from the person or
attached to the person juridical entity.(Section
or judicial entity that 149, Intellectual Property
Code)
does business. (Section
165, Intellectual Property
Code)
ACQUISITION OF OWNERSHIP:

Acquisition of ownership of mark

The rights in a mark shall be acquired through registration made validly in accordance with the provisions
of this law. (Section 122, Intellectual Property Code)

Acquisition of ownership of trade name

Ownership of a mark or trade name may be acquired not necessarily by registration but by adoption and
use in trade or commerce. (Shangri-la International Hotel Management, Ltd., et al. v. Developers Group of Companies, Inc.,
G.R. No. 159938)

NON-REGISTRABLE MARK

Non-registrable marks (Section 123.1, Intellectual Property Code)

• Consists of immoral, deceptive or scandalous matter, or matter which may disparage or falsely
suggest a connection with persons, living or dead, institutions, beliefs, or national symbols, or
bring them into contempt or disrepute;

• Consists of the flag or coat of arms or other insignia of the Philippines or any of its political
subdivisions, or of any foreign nation, or any simulation thereof;

• Consists of a name, portrait or signature identifying a particular living individual except by his
written consent, or the name, signature, or portrait of a deceased President of the Philippines,
during the life of his widow, if any, except by written consent of the widow;

• Is identical with a registered mark belonging to a different proprietor or a mark with an earlier
filing or priority date, in respect of:

• The same goods or services, or

• Closely related goods or services, or

• If it nearly resembles such a mark as to be likely to deceive or cause confusion;

• Is identical with, or confusingly similar to, or constitutes a translation of a mark which is

considered by the competent
authority of the Philippines to be well-
known internationally and in the Philippines, whether or not it is registered here, as being already
the mark of a person other than the applicant for registration, and used for identical or similar
goods or services;

• Is identical with, or confusingly similar to, or constitutes a translation of a mark considered well-
known in accordance with the preceding paragraph, which is registered in the Philippines with
respect to goods or services which are not similar to those with respect to which registration is
applied for: Provided, That use of the mark in relation to those goods or services would indicate a
connection between those goods or services, and the owner of the registered mark: Provided
further, That the interests of the owner of the registered mark are likely to be damaged by such
use;

• Is likely to mislead the public, particularly as to the nature, quality, characteristics or

geographical origin of the goods or services;
 • Consists exclusively of signs that are generic for the goods or services that they seek to identify;

• Consists exclusively of signs or of indications that have become customary or usual to designate
the goods or services in everyday language or in bona fide and established trade practice;

• Consists exclusively of signs or of indications that may serve in trade to designate the kind,
quality, quantity, intended purpose, value, geographical origin, time or production of the goods
or rendering of the services, or other characteristics of the goods or services;

• Consists of shapes that may be necessitated by technical factors or by the nature of the goods
themselves or factors that affect their intrinsic value;

• Consists of color alone, unless defined by a given form; or

• Is contrary to public order or morality.

Marks which become distinctive can be registered

As regards signs or devices mentioned in paragraphs (j), (k), and (l), nothing shall prevent the
registration of any such sign or device which has become distinctive in relation to the goods for which
registration is requested as a result of the use that have been made of it in commerce in the Philippines.
The Office may accept as prima facie evidence that the mark has become distinctive, as used in
connection with the applicant’s goods or services in commerce, proof of substantially exclusive and
continuous use thereof by the applicant in commerce in the Philippines for five (5) years before the date
on which the claim of distinctiveness is made. (Section 123.2, Intellectual Property Code)

TEST TO DETERMINE CONFUSING SIMILARITY BETWEEN MARKS

Tests to determine confusing similarity between marks:

1. Dominancy test

2. Holistic test

Dominancy test:

• The dominancy test focuses on the similarity of the prevalent features of the competing trademarks
that might cause confusion or deception. (McDonald Corporation vs. MacJoy Fastfood Corporation, G.R. No. 166115,
February 2, 2007)

• By focusing not simply on similarities in size, form or color but on the main or essential features of
each mark taken together. Duplication is not necessary, and similarity, while relevant, is not
conclusive. (Asia Brewery, Inc. vs. Court of Appeals, G.R. No. 103543, July 5, 1993)

• The test was similarity or "resemblance between the two (trademarks) such as would be likely to
cause the one mark to be mistaken for the other… But this is not such similitude as amounts to
identity." (Asia Brewery, Inc. vs. Court of Appeals, G.R. No. 103543, July 5, 1993, citing Forbes, Munn & Co. (Ltd.) vs. Ang
San To, 40 Phil. 272)

Holistic test:

• The holistic test requires the court to consider the entirety of the marks as applied to the products,
including the labels and packaging, in determining confusing similarity. Under the latter test, a
comparison of the words is not the only determinant factor. (McDonald Corporation vs.MacJoy Fastfood
Corporation, G.R. No. 166115, February 2, 2007)
• It considers the entirety of the marks, including labels and packaging, in determining confusing
similarity. The focus is not only on the predominant words but also on the other features appearing
on the labels. (Societe Des Produits Nestle S.A. vs. Dy, G.R. No. 172276)

WELL-KNOWN MARKS:

Well-Known marks, how determined:

In determining whether a mark is well-known, account shall be taken of the knowledge of the relevant
sector of the public, rather than of the public at large, including knowledge in the Philippines which has
been obtained as a result of the promotion of the mark. (Section 123, Intellectual Property Code)

RIGHTS CONFERRED BY TRADEMARK REGISTRATION

Rights conferred by registration:

• Exclusive right to prevent all third parties from using identical or similar signs or containers
• Exclusive right to prevent all third person from using mark indicating a connection between those
goods and services of third persons and those of the owner of registered mark

Exclusive right to prevent all third parties from using identical or similar signs or containers
The owner of a registered mark shall have the exclusive right to prevent all third parties not having the
owner’s consent from using in the course of trade identical or similar signs or containers for goods or
services which are identical or similar to those in respect of which the trademark is registered where such
use would result in a likelihood of confusion. In case of the use, of an identical sign for identical goods or
services, a likelihood of confusion shall be presumed. (Section 147.1, Intellectual Property Code)

Exclusive right to prevent all third person from using mark indicating a connection between
those goods and services of third persons and those of the owner of registered mark
The exclusive right of the owner of a well-known mark which is registered in the Philippines, shall extend
to goods and services which are not similar to those in respect of which the mark is
registered: Provided, That use of that mark in relation to those goods or services would indicate a
connection between those goods or services and the owner of the registered mark: Provided,
further, That the interests of the owner of the registered mark are likely to be damaged by such use .
(Section 147.2, Intellectual Property Code)

INFRINGEMENT AND REMEDIES

Acts constituting trademark infringements (Section 155, Intellectual Property Code)

Any person who shall, without the consent of the owner of the registered mark:

• (155.1.) Use in commerce any reproduction, counterfeit, copy, or colorable imitation of a registered
mark or the same container or a dominant feature thereof in connection with the sale, offering for
sale, distribution, advertising of any goods or services including other preparatory steps necessary to
carry out the sale of any goods or services on or in connection with which such use is likely to cause
confusion, or to cause mistake, or to deceive; or

• (155.2.) Reproduce, counterfeit, copy or colorably imitate a registered mark or a dominant feature
thereof and apply such reproduction, counterfeit, copy or colorable imitation to labels, signs, prints,
packages, wrappers, receptacles or advertisements intended to be used in commerce upon or in
connection with the sale, offering for sale, distribution, or advertising of goods or services on or in
 connection with which such use is likely to cause confusion, or to cause mistake, or to deceive, shall
be liable in a civil action for infringement by the registrant for the remedies hereinafter set forth:
Provided, That the infringement takes place at the moment any of the acts stated in Subsection
155.1 or this subsection are committed regardless of whether there is actual sale of goods or services
using the infringing material.

Remedies against trademark infringer: (Section 156, Intellectual Property Code)

• The owner of a registered mark may recover damages from any person who infringes his rights, and
the measure of the damages suffered shall be either the reasonable profit which the complaining
party would have made, had the defendant not infringed his rights, or the profit which the defendant
actually made out of the infringement, or in the event such measure of damages cannot be readily
ascertained with reasonable certainty, then the court may award as damages a reasonable
percentage based upon the amount of gross sales of the defendant or the value of the services in
connection with which the mark or trade name was used in the infringement of the rights of the
complaining party.

• On application of the complainant, the court may impound during the pendency of the action, sales
invoices and other documents evidencing sales.

• In cases where actual intent to mislead the public or to defraud the complainant is shown, in the
discretion of the court, the damages may be doubled.

• The complainant, upon proper showing, may also be granted injunction.

Damages which can be recovered from infringer (Section 156.1, Intellectual Property Code)

• The reasonable profit which the complaining party would have made, had the defendant not infringed
his rights;

• The profit which the defendant actually made out of the infringement;

• A reasonable percentage based upon the amount of gross sales of the defendant or the value of the
services in connection with which the mark or trade name was used in the infringement of the rights
of the complaining party, which the court may award as damages in the event such measure of
damages cannot be readily ascertained with reasonable certainty.

Notice requirement in recovering damages for infringement

In any suit for infringement, the owner of the registered mark shall not be entitled to recover profits or
damages unless the acts have been committed with knowledge that such imitation is likely to cause
confusion, or to cause mistake, or to deceive. Such knowledge is presumed if the registrant gives notice
that his mark is registered by displaying with the mark the words '"Registered Mark" or the letter R within
a circle or if the defendant had otherwise actual notice of the registration. (Section 158, Intellectual Property
Code)

UNFAIR COMPETITION

Person who has property right in goodwill of identified goods, business or services,
protected
A person who has identified in the mind of the public the goods he manufactures or deals in, his business
or services from those of others, whether or not a registered mark is employed, has a property right in
the goodwill of the said goods, business or services so identified, which will be protected in the same
manner as other property rights. (Section 168.1, Intellectual Property Code)
Acts constituting unfair competition
(Section 168.2, Intellectual Property Code)

Any person shall be guilty of unfair competition who shall:

• employ deception, or any other means contrary to good faith by which he shall pass off the goods
manufactured by him or in which he deals, or his business, or services for those of the one having
established such goodwill, or
• commit any acts calculated to produce said result

Particular acts constituting unfair competition, person liable:

(Section 168.3, Intellectual Property Code)

In particular, and without in any way limiting the scope of protection against unfair competition, the
following shall be deemed guilty of unfair competition:

• Any person, who is selling his goods and gives them the general appearance of goods of another
manufacturer or dealer, either as to the goods themselves or in the wrapping of the packages in
which they are contained, or the devices or words thereon, or in any other feature of their
appearance, which would be likely to influence purchasers to believe that the goods offered are those
of a manufacturer or dealer, other than the actual manufacturer or dealer, or who otherwise clothes
the goods with such appearance as shall deceive the public and defraud another of his legitimate
trade, or any subsequent vendor of such goods or any agent of any vendor engaged in selling such
goods with a like purpose;

• Any person who by any artifice, or device, or who employs any other means calculated to induce the
false belief that such person is offering the services of another who has identified such services in the
mind of the public; or

• Any person who shall make any false statement in the course of trade or who shall commit any other
act contrary to good faith of a nature calculated to discredit the goods, business or services of
another.

Difference between infringement of trademark and unfair competition:

INFRINGEMENT OF
UNFAIR COMPETITION
TRADEMARK
It is the unauthorized It is the passing off of
use of a trademark; one’s goods as those of
another;
Fraudulent intent is Fraudulent intent is
unnecessary; essential;
Prior registration of Registration is not
the trademark is a
prerequisite to the necessary.
action.

COPYRIGHT

BASIC PRINCIPLES:

• Works are protected by the sole fact of their creation.

• Copyright is distinct from the property in the material object subject to it.
• News of today, office text of legislative or administrative or legal nature, not protected.

Works are protected by the sole fact of their creation

Works are protected by the sole fact of their creation, irrespective of their mode or form of expression, as
well as of their content, quality and purpose. (Section 172.2, Intellectual Property Code)

Copyright is distinct from the property in the material object subject to it

The copyright is distinct from the property in the material object subject to it. Consequently, the transfer
or assignment of the copyright shall not itself constitute a transfer of the material object. Nor shall a
transfer or assignment of the sole copy or of one or several copies of the work imply transfer or
assignment of the copyright. (Section 181 Intellectual Property Code)

Unprotected subject matter

No protection shall extend, under this law, to any idea, procedure, system, method or operation, concept,
principle, discovery or mere data as such, even if they are expressed, explained, illustrated or embodied
in a work; news of the day and other miscellaneous facts having the character of mere items of press
information; or any official text of a legislative, administrative or legal nature, as well as any official
translation thereof. (Section 175, Intellectual Property Code)

COPYRIGHTABLE WORKS

Copyrightable works:

1. Original works
2. Derivative works

Original works: (Section 172.1, Intellectual Property Code)

Literary and artistic works, hereinafter referred to as "works", are original intellectual creations in the
literary and artistic domain protected from the moment of their creation and shall include in particular:

• Books, pamphlets, articles and other writings;

• Periodicals and newspapers;

• Lectures, sermons, addresses, dissertations prepared for oral delivery, whether or not reduced in
writing or other material form;

• Letters;

• Dramatic or dramatico-musical compositions; choreographic works or entertainment in dumb shows;

• Musical compositions, with or without words;

• Works of drawing, painting, architecture, sculpture, engraving, lithography or other works of art;
models or designs for works of art;

• Original ornamental designs or models for articles of manufacture, whether or not registrable as an
industrial design, and other works of applied art;

• Illustrations, maps, plans, sketches, charts and three-dimensional works relative to geography,
topography, architecture or science;
• Drawings or plastic works of a scientific or technical character;
• Photographic works including works produced by a process analogous to photography; lantern slides;

• Audiovisual works and cinematographic works and works produced by a process analogous to
cinematography or any process for making audio-visual recordings;

• Pictorial illustrations and advertisements;

• Computer programs; and

• Other literary, scholarly, scientific and artistic works.

Derivative works (Section 173.1, Intellectual Property Code)

• Dramatizations, translations, adaptations, abridgments, arrangements, and other alterations of

literary or artistic works; and

• Collections of literary, scholarly or artistic works, and compilations of data and other materials which
are original by reason of the selection or coordination or arrangement of their contents.

Derivative works protected as new works

The above works shall be protected as a new works: Provided however, that such new work shall not
affect the force of any subsisting copyright upon the original works employed or any part thereof, or be
construed to imply any right to such use of the original works, or to secure or extend copyright in such
original works. (Section 173.2, Intellectual Property Code)

NON-COPYRIGHTABLE WORKS

Non-copyrightable works
1. Unprotected subject matters
2. Works of the government
3. Collection of an author’s works, said author has exclusive right to it

Unprotected subject matters (Section 175, Intellectual Property Code)

Notwithstanding the provisions of Sections 172 and 173, no protection shall extend, under this law, to:

• any idea, procedure, system method or operation, concept, principle, discovery or mere data as such,
even if they are expressed, explained, illustrated or embodied in a work;

• news of the day and other miscellaneous facts having the character of mere items of press
information; or

• any official text of a legislative, administrative or legal nature, as well as any official translation
thereof.

Works of the government

No copyright shall subsist in any work of the Government of the Philippines. (Section 176.1, Intellectual Property
Code)

Prior approval of the government necessary for exploitation of its works

However, prior approval of the government agency or office wherein the work is created shall be
necessary for exploitation of such work for profit. Such agency or office may, among other things, impose
as a condition the payment of royalties. (Section 176.1, Intellectual Property Code)
Prior approval, not necessary in these government works
No prior approval or conditions shall be required for the use of any purpose of statutes, rules and
regulations, and speeches, lectures, sermons, addresses, and dissertations, pronounced, read or
rendered in courts of justice, before administrative agencies, in deliberative assemblies and in meetings
of public character. (Section 176.1, Intellectual Property Code)

Collection of an author’s work, author has exclusive right

The author of speeches, lectures, sermons, addresses, and dissertations mentioned in the preceding
paragraphs shall have the exclusive right of making a collection of his works. (Section 176.2, Intellectual
Property Code)

RIGHTS OF COPYRIGHT OWNER

Rights of copyright owner

1. economic rights
2. moral rights
3. rights to proceeds in subsequent transfer

Economic rights of copyright owner: (Section 177, Intellectual Property Code)

It is the exclusive right to carry out, authorize or prevent the following acts:

• Reproduction of the work or substantial portion of the work;

• Dramatization, translation, adaptation, abridgment, arrangement or other transformation of the work;

• The first public distribution of the original and each copy of the work by sale or other forms of
transfer of ownership;

• Rental of the original or a copy of an audiovisual or cinematographic work, a work embodied in a

sound recording, a computer program, a compilation of data and other materials or a musical work in
graphic form, irrespective of the ownership of the original or the copy which is the subject of the
rental;

• Public display of the original or a copy of the work;

• Public performance of the work; and

• Other communication to the public of the work

Moral rights of copyright owner: (Section 193, Intellectual Property Code)

The author of a work shall, independently of the economic rights or the grant of an assignment or license
with respect to such right, have the right:

• To require that the authorship of the works be attributed to him, in particular, the right that his
name, as far as practicable, be indicated in a prominent way on the copies, and in connection with
the public use of his work;

• To make any alterations of his work prior to, or to withhold it from publication;

• To object to any distortion, mutilation or other modification of, or other derogatory action in relation
to, his work which would be prejudicial to his honor or reputation; and
• To restrain the use of his name with respect to any work not of his own creation or in a distorted
version of his work.

Rights to proceeds in subsequent transfer

In every sale or lease of an original work of painting or sculpture or of the original manuscript of a writer
or composer, subsequent to the first disposition thereof by the author, the author or his heirs shall have
an inalienable right to participate in the gross proceeds of the sale or lease to the extent of 5%. This
right shall exist during the lifetime of the author and for 50 years after his death. (Section 200, Intellectual
Property Code)

Exception to the rights to proceeds in subsequent transfer

This shall not apply to prints, etchings, engravings, works of applied art, or works of similar kind wherein
the author primarily derives gain from the proceeds of reproductions. (Section 201, Intellectual Property Code)

RULES ON OWNERSHIP OF COPYRIGHT

In original literary and artistic work, in general

In the case of original literary and artistic works, copyright shall belong to the author of the work. (Section
178.1, Intellectual Property Code)

In cases of joint ownership: (Section 178.2, Intellectual Property Code)

1. In the case of works of joint authorship, the co-authors shall be the original owners of the copyright
and in the absence of agreement, their rights shall be governed by the rules on co-ownership.

2. If, however, a work of joint authorship consists of parts that can be used separately and the author
of each part can be identified, the author of each part shall be the original owner of the copyright in
the part that he has created

In cases where there is employer-employee relationship: (Section 178.3, Intellectual Property Code)

In the case of work created by an author during and in the course of his employment, the copyright shall
belong to:

1. The employee, if the creation of the object of copyright is not a part of his regular duties even if the
employee uses the time, facilities and materials of the employer.

2. The employer, if the work is the result of the performance of his regularly-assigned duties, unless
there is an agreement, express or implied, to the contrary.

In cases of commissioned work

The person who so commissioned the work shall have ownership of the work, but the copyright thereto
shall remain with the creator, unless there is a written stipulation to the contrary. (Section 178.4, Intellectual
Property Code)

In cases of audio-visual works

In the case of audiovisual work, the copyright shall belong to the producer, the author of the scenario,
the composer of the music, the film director, and the author of the work so adapted. However, subject to
contrary or other stipulations among the creators, the producer shall exercise the copyright to an extent
required for the exhibition of the work in any manner, except for the right to collect performing license
fees for the performance of musical compositions, with or without words, which are incorporated into the
work. (Section 178.5, Intellectual Property Code)

In cases of letters:
• In respect of letters, the copyright shall belong to the writer subject to the provisions of Article 723 of
the Civil Code. (Section 178.6, Intellectual Property Code)

• Letters and other private communications in writing are owned by the person to whom they are
addressed and delivered, but they cannot be published or disseminated without the consent of the
writer or his heirs. However, the court may authorize their publication or dissemination if the public
good or the interest of justice so requires. (Article 723, Civil Code of the Philippines)

In cases of anonymous and pseudonymous works

The publishers shall be deemed to represent the authors of articles and other writings published without
the names of the authors or under pseudonyms, unless the contrary appears, or the pseudonyms or
adopted name leaves no doubt as to the author’s identity, or if the author of the anonymous works
discloses his identity. (Section 179, Intellectual Property Code)

Summary on rules on copyright ownership:

CREATOR OWNER
Single creator Author, heirs, assigns.
Co-authors
If no agreement, co
ownership (no identifiable
Joint creation
part)
Identifiable parts: author of
part he has created.
Person commissioned,
Commissioned work
unless there is stipulation.
Producer (for exhibit)
Producer, author of scenario,
Audio Visual composer, film director,
author of work (other
purposes).
Pseudonyms and Presumption: publisher
Anonymous Works unless proved otherwise.
Employer if part of his
duties,
Employees
if not part of his duties,
employee.

Duration of copyright protection:

DURATION
TYPE OF WORK
(+ = AFTER DEATH)
Single creator / Life time and 50 years after
News paper article death of creator.(Section 213,
of creator Intellectual Property Code)
Lifetime of last surviving co-
creator and 50 years after
Joint creator death of last surviving co-
creator.(Section 213,
Intellectual Property Code)
50 years after 1st publication
If author is revealed or
came to be known, lifetime
Anonymous or
and 50 years after death of
pseudonymic work
the author.
 In case of co-authorship
(authors became known),
lifetime and 50 years after
death of last surviving
author or co-creator.(Section
213, Intellectual Property Code)

25 years from date of

Work of applied art. making or creation.(Section
213, Intellectual Property Code)
Published – 50 years from
publication
Photographic work. Unpublished- from
making.(Section 213,
Intellectual Property Code)

LIMITATION ON COPYRIGHT

Limitations on copyright
• Limitation to copyright ownership; acts not constituting infringement
• Acts provided for by Article 184.1 which do not constitute infringement of copyright
• Doctrine of fair use
• Limitation to use; acts constituting copyright infringement

LIMITATION TO COPYRIGHT OWNERSHIP

Acts which do not constitute infringement of copyright (Section 184.1, Intellectual Property Code)

• The recitation or performance of a work, once it has been lawfully made accessible to the public, if
done privately and free of charge or if made strictly for a charitable or religious institution or society;
• The making of quotations from a published work if they are compatible with fair use and only to the
extent justified for the purpose, including quotations from newspaper articles and periodicals in the
form of press summaries: Provided, That the source and the name of the author, if appearing on the
work, are mentioned;

• The reproduction or communication to the public by mass media of articles on current political, social,
economic, scientific or religious topic, lectures, addresses and other works of the same nature, which
are delivered in public if such use is for information purposes and has not been expressly reserved:
Provided, That the source is clearly indicated;

• The reproduction and communication to the public of literary, scientific or artistic works as part of
reports of current events by means of photography, cinematography or broadcasting to the extent
necessary for the purpose;

• The inclusion of a work in a publication, broadcast, or other communication to the public, sound
recording or film, if such inclusion is made by way of illustration for teaching purposes and is
compatible with fair use: Provided, That the source and of the name of the author, if appearing in the
work, are mentioned;

• The recording made in schools, universities, or educational institutions of a work included in a

broadcast for the use of such schools, universities or educational institutions: Provided, That such
recording must be deleted within a reasonable period after they were first broadcast: Provided,
further, That such recording may not be made from audiovisual works which are part of the general
cinema repertoire of feature films except for brief excerpts of the work;
• The making of ephemeral recordings by a broadcasting organization by means of its own facilities
and for use in its own broadcast;

• The use made of a work by or under the direction or control of the Government, by the National
Library or by educational, scientific or professional institutions where such use is in the public interest
and is compatible with fair use;

• The public performance or the communication to the public of a work, in a place where no admission
fee is charged in respect of such public performance or communication, by a club or institution for
charitable or educational purpose only, whose aim is not profit making, subject to such other
limitations as may be provided in the Regulations;

• Public display of the original or a copy of the work not made by means of a film, slide, television
image or otherwise on screen or by means of any other device or process: Provided, That either the
work has been published, or, that the original or the copy displayed has been sold, given away or
otherwise transferred to another person by the author or his successor in title; and

• Any use made of a work for the purpose of any judicial proceedings or for the giving of professional
advice by a legal practitioner.

Doctrine of fair use

The fair use of a copyrighted work for criticism, comment, news reporting, teaching including multiple
copies for classroom use, scholarship, research, and similar purposes is not an infringement of copyright.
(Section 185.1, Intellectual Property Code)

Factors in determining if of fair use (Section 185.1, Intellectual Property Code)

In determining whether the use made of a work in any particular case is fair use, the factors to be
considered shall include:

• The purpose and character of the use, including whether such use is of a commercial nature or is
for non-profit educational purpose;

• The nature of the copyrighted work;

• The amount and substantiality of the portion used in relation to the copyrighted work as a whole;
and

• The effect of the use upon the potential market for or value of the copyrighted work.

Above factors also applicable to unpublished work

The fact that a work is unpublished shall not by itself bar a finding of fair use if such finding is made
upon consideration of all the above factors. (Section 185.2, Intellectual Property Code)

COPYRIGHT INFRINGEMENT

Copyright infringement, how committed

(Section 216 of Intellectual Property Code as amended by Section 22, 10372)

A person infringes a right protected under this Act when one:

• Directly commits an infringement;

 • Benefits from the infringing activity of another person who commits an infringement if the person
benefiting has been given notice of the infringing activity and has the right and ability to control
the activities of the other person;

• With knowledge of infringing activity, induces, causes or materially contributes to the infringing
conduct of another.

REMEDIES AGAINST COPYRIGHT INFRINGER

Remedies against infringer:

(Section 216 of Intellectual Property Code as amended by Section 22, R.A. No. 10372)

• To an injunction restraining such infringement.

The court may also order the defendant to desist from an infringement, among others, to prevent the
entry into the channels of commerce of imported goods that involve an infringement, immediately
after customs clearance of such goods.

• Pay to the copyright proprietor or his assigns or heirs such actual damages, including legal costs and
other expenses, as he may have incurred due to the infringement as well as the profits the infringer
may have made due to such infringement.

And in proving profits the plaintiff shall be required to prove sales only and the defendant shall be
required to prove every element of cost which he claims, or, in lieu of actual damages and profits,
such damages which to the court shall appear to be just and shall not be regarded as penalty.
Provided, That the amount of damages to be awarded shall be doubled against any person who:

a. Circumvents effective technological measures; or

b. Having reasonable grounds to know that it will induce, enable, facilitate or conceal the
infringement, remove or alter any electronic rights management information from a copy of a
work, sound recording, or fixation of a performance, or distribute, import for distribution,
broadcast, or communicate to the public works or copies of works without authority, knowing
that electronic rights management information has been removed or altered without authority.

• Deliver under oath, for impounding during the pendency of the action, upon such terms and
conditions as the court may prescribe, sales invoices and other documents evidencing sales, all
articles and their packaging alleged to infringe a copyright and implements for making them

• Deliver under oath for destruction without any compensation all infringing copies or devices, as well
as all plates, molds, or other means for making such infringing copies as the court may order.

• Such other terms and conditions, including the payment of moral and exemplary damages, which the
court may deem proper, wise and equitable and the destruction of infringing copies of the work even
in the event of acquittal in a criminal case.
Other remedies:

• In an infringement action, the court shall also have the power to order the seizure and impounding of
any article which may serve as evidence in the court proceedings, in accordance with the rules on
 search and seizure involving violations of intellectual property rights issued by the Supreme Court.
(Section 216.2 of Intellectual Property Code as amended by Section 22, R.A. No. 10372)

• The foregoing shall not preclude an independent suit for relief by the injured party by way of
damages, injunction, accounts or otherwise. (Section 216.2 of Intellectual Property Code as appended by Section
22, R.A. No. 10372)

Criminal penalties (Section 217.1 of Intellectual Property Code)

Any person infringing any right secured by provisions of Part IV of this Act or aiding or abetting such
infringement shall be guilty of a crime punishable by:

• Imprisonment of one (1) year to three (3) years plus a fine ranging from Fifty thousand pesos
(P50,000) to One hundred fifty thousand pesos (P150,000) for the first offense.

• Imprisonment of three (3) years and one (1) day to six (6) years plus a fine ranging from One
hundred fifty thousand pesos (P150,000) to Five hundred thousand pesos (P500,000) for the
second offense.

• Imprisonment of six (6) years and one (1) day to nine (9) years plus a fine ranging from five
hundred thousand pesos (P500,000) to One million five hundred thousand pesos (P1,500,000)
for the third and subsequent offenses.

• In all cases, subsidiary imprisonment in cases of insolvency.

Determination of number of years of imprisonment

(Section 217.2 of Intellectual Property Code as amended by Section 23, R.A. No. 10372)

In determining the number of years of imprisonment and the amount of fine, the court shall consider the
value of the infringing materials that the defendant has produced or manufactured and the damage that
the copyright owner has suffered by reason of the infringement: Provided, that the respective maximum
penalty stated in Section 217.1. (a), (b) and (c) herein for the first, second, third and subsequent
offense, shall be imposed when the infringement is committed by:

• the circumvention of effective technological measures;

• the removal or alteration of any electronic rights management information from a copy of a work,
sound recording, or fixation of a performance, by a person, knowingly and without authority; or

• the distribution, importation for distribution, broadcast, or communication to the public of works or
copies of works, by a person without authority, knowing that electronic rights management
information has been removed or altered without authority.

Purposes by which any person may be held liable for possession of property with subsisting
copyright (Section 217.3 of Intellectual Property Code

Any person shall be guilty of an offense and shall be liable on conviction to imprisonment and fine as
above mentioned who at the time when copyright subsists in a work has in his possession an article
which he knows, or ought to know, to be an infringing copy of the work for the purpose of:

• Selling, letting for hire, or by way of trade offering or exposing for sale, or hire, the article;

• Distributing the article for purpose of trade, or for any other purpose to an extent that will prejudice
the rights of the copyright owner in the work; or
• Trade exhibit of the article in public,

Q&A:

1. State the difference between Patents, Copyright, and Trademark

Patents Copyright Trademark

Any technical Confined to Any visible sign
solution of a literary and capable of
problem in any artistic works distinguishing
field of human which are the goods
activity which is original (trademark) or
new, involves an intellectual services
inventive step creations in (service mark)
and is industrially the literary of an enterprise
applicable. and artistic and shall
domain include a
protected stamped or
from the marked
moment of container of
their goods.
creation.
Term of Generally, Term of
protection is 20 term of protection is 10
years from the protection is years and may
filing of during the be renewed
application, non- author’s
renewable lifetime and
50 years
after his
death
IP rights vest IP rights vest IP rights vest
upon issuance of from the upon
letter of patents moment of registration
creation

A trademark is any visible sign capable of distinguishing the goods (trademark) or services (service mark)
of an enterprise and shall include a stamped or marked container of goods; a trade name refers to the
name or designation identifying or distinguishing an enterprise. Copyright is confined to literary and
artistic works which are original intellectual creations in the literary and artistic domain protected from
the moment of their creation. On the other hand, patentable inventions refer to any technical solution of
a problem in any field of human activity which is new, involves an inventive step and is industrially
applicable. (Pearl & Dean (Phil.), Inc. vs. Shoemart, Inc., G.R. No. 148222, August 15, 2003)

2. What is a utility model?

A utility model is a technical solution to a problem in any field of human activity which is new and
industrially applicable; it may be, or may relate to, a product, or process, or an improvement of any of
the aforesaid. Being plain automotive spare parts that must conform to the original structural design of
the components they seek to replace, the Leaf Spring Eye Bushing and Vehicle Bearing Cushion are not
ornamental; they lack the decorative quality or value that must characterize authentic works of applied
art and in actuality, they are utility models, useful articles, albeit with no artistic design or value. (Jessie
Ching vs. William Salinas, et. al., G.R. No. 161295, June 29, 2005)

3. Why is there a need to secure a patent?

The ultimate goal of a patent system is to bring new designs and technologies into the public through
disclosure; hence, ideas, once disclosed to the public without protection of a valid patent, are subject to
appropriation without significant restraint. (Pearl & Dean (Phil.), Inc. vs. Shoemart, Inc., G.R. No. 148222, August 15,
2003)

4. Give the purpose/s of a patent.

The patent law has a three-fold purpose: first, it seeks to foster and reward invention; second, it
promotes disclosure of inventions to stimulate further innovation and to permit the public to practice the
invention once the patent expires; and third, the stringent requirements for patent protection seek to
ensure that ideas in the public domain remain there for the free use of the public and it is only after an
exhaustive examination by the patent office that patent is issued. Not having gone through the arduous
examination for patents, petitioner cannot exclude others from the manufacture, sale or commercial use
of the light boxes on the sole basis of its copyright certificate over the technical drawings. (Pearl & Dean
(Phil.), Inc. vs. Shoemart, Inc., G.R. No. 148222, August 15, 2003)

5. Mark invented a lampshade that does not need electricity for it to function. The invention
uses only the light and sound energy inside the room to create electric current to produce
light. Mark is also a gifted metal sculpture. He crafted a “Venus-inspired” design of the said
lampshade, which he calls the “Venus Lamp.” Because the design is so appealing, people
would buy the lampshade not because of its use but because of its attractive feature.

Does Mark have a separate copyright over the Venus metal sculpture without the Venus
Lamp attached to it?

Yes. Under the Denicola Test in intellectual property law, if design elements of an article reflect a merger
of aesthetic and functional considerations, and the artistic aspects of the work can be conceptually
separated from the utilitarian aspects, the article can be copyrighted separately when it is detached from
the utilitarian function. In this instance, the Venus metal sculpture can be conceptually separated from
the Venus Lamp and yet the utilitarian function of the material is still intact. Therefore, Mark has a
copyright over his design, separate and distinct from his intellectual property over the utilitarian function
of the Venus Lamp.

6.Will your answer be the same if the lampshade would not work if not used with the
“Venus-inspired” body of the lampshade?

My answer will be different if the lampshade does not work without the Venus-inspired body. As
explained above using the Denicola Test, if the artistic aspects of a creative work cannot be conceptually
separated from its utilitarian aspects, the article cannot be copyrighted. Thus, if the Venus Lamp would
not work when the Venus sculpture is separated from it, the design element of the lamp cannot be
copyrighted.

7. What is the Doctrine of Equivalents?

An infringement occurs when a device appropriates a prior invention by incorporating its innovative
concept and, albeit with some modification and change, performs substantially the same function in
substantially the same way to achieve substantially the same result. (Godines vs. Court of Appeals, 1993)

Under the doctrine of equivalents, there is infringement if two devices do the same work in substantially
the same way, and accomplish substantially the same result, even though they differ in name, form, or
shape. The reason for the doctrine of equivalents is that to permit the imitation of a patented invention
which does not copy any literal detail would be to convert the protection of the patent grant into a hollow
and useless thing. (Pascual Godines vs. Court of Appeals, G.R. No. 97343, September 13, 1993)
The doctrine of equivalents provides that an infringement takes place when a device appropriates a prior
invention by incorporating its innovative concept and, although with some modification and change,
performs substantially the same function in substantially the same way to achieve substantially the same
result; it requires satisfaction of the function-means-and-result test. In this case, while both compounds
have the effect of neutralizing parasites in animals, identity of result does not amount to infringement of
patent unless Albendazole operates in substantially the same way or by substantially the same means as
the patented compound, even though it performs the same function and achieves the same result. (Smith
Kline Beckman Corporation vs. Court of Appeals, G.R. No. 126627, August 14, 2003)

8. Cezar works in a car manufacturing company owned by Joab. Cezar is quite innovative
and loves to tinker with things. With the materials and parts of the car, he was able to invent
a gas-saving device that will enable cars to consume less gas. Francis, a co-worker, saw how
Cezar created the device and likewise, came up with a similar gadget, also using scrap
materials and spare parts of the company. Thereafter, Francis filed an application for
registration of his device with the Bureau of Patents. Eighteen months later, Cezar filed his
application for the registration of his device with the Bureau of Patents.

Assuming that it is patentable, who is entitled to the patent, is it Joab, Cezar, or Francis?

Francis is entitled to the patent. Our jurisdiction follows the “First-to-File” rule as embodied in Section 29
of the Intellectual Property Code which states that “If two (2) or more persons have made the invention
separately and independently of each other, the right to the patent shall belong to the person who filed
an application for such invention, or where two or more applications are filed for the same invention, to
the applicant who has the earliest filing date or, the earliest priority date.”

Section 30 on the other hand provides that in case the employee made the invention in the course of his
employment contract, the patent shall belong to the employee, if the inventive activity is not a part of his
regular duties even if the employee uses the time, facilities and materials of the employer.

9. What are the remedies of the true and actual inventor?

The true and actual inventor may file an action before the courts within one year from
publication of the application or grant of patent, as the case may be.

If declared by final court order or decision as the true and actual inventor, the court shall order his
substitution as patentee; or at the option of the true inventor,cancel the patent, and award actual
and other damages in his favor if warranted by the circumstances. (Section 68, Intellectual Property Code)

10. Rudy is a fine arts student in a university. He stays in a boarding house with Bernie as his
roommate. During his free time, Rudy would paint and leave his finished works lying around
the boarding house. One day, Rudy saw one of his works -an abstract painting entitled
Manila Traffic Jam - on display at the university cafeteria. The cafeteria operator said he
purchased the painting from Bernie who represented himself as its painter and owner.

Rudy and the cafeteria operator immediately confronted Bernie. While admitting that he did
not do the painting, Bernie claimed ownership of its copyright since he had already
registered it in his name with the National Library as provided in the Intellectual Property
Code.

Who owns the copyright to the painting? Explain.

Rudy owns the copyright. The Intellectual Property Code states that in case of original literary and artistic
works, copyright shall belong to the author of the work. The Code provides further that literary and
artistic works are protected by the sole fact of their creation, irrespective of their mode or form of
expression, as well as of their content, quality and purpose.

10. Explain the Doctrine of Secondary Meaning.

A word or phrase originally incapable of exclusive appropriation with reference to an article on the
market, because geographically or otherwise descriptive, might nevertheless have been used so long and
so exclusively by one producer with reference to his article that, in that trade and to that branch of the
purchasing public, the word or phrase has come to mean that the article was his product. (Lyceum of the
Phils. vs. Court of Appeals, 219 SCRA 610)

11. What are the two tests used in determining whether there is trademark infringement?
Explain each test.

In determining similarity and likelihood of confusion, jurisprudence has developed tests: the Dominancy
Test and the Holistic or Totality Test.

The Dominancy Test focuses on the similarity of the prevalent or dominant features of the competing
trademarks that might cause confusion, mistake, and deception in the mind of the purchasing public.
Duplication or imitation is not necessary; neither is it required that the mark sought to be registered
suggests an effort to imitate. Given more consideration are the aural and visual impressions created by
the marks on the buyers of goods, giving little weight to factors like prices, quality, sales outlets, and
market segments.

The Holistic or Totality Test necessitates a consideration of the entirety of the marks as applied to the
products, including the labels and packaging, in determining confusing similarity. The discerning eye of
the observer must focus not only on the predominant words, but also on the other features appearing on
both labels so that the observer may draw conclusion on whether one is confusingly similar to the other.

12. Is it necessary that a foreign well-known mark be registered in the Philippines before
said well-known mark may be protected in the Philippines?

No. The fact that [respondent’s] marks are neither registered nor used in the Philippines is of no
moment. The scope of protection initially afforded by Article 6b of the Paris Convention has been
expanded in the 1999 Joint Recommendation Concerning Provisions on the Protection of Well-Known
Marks, wherein the World Intellectual Property Organization (WIPO) General Assembly and the Paris
Union agreed to a nonbinding recommendation that a well-known mark should be protected in a country
even if the mark is neither registered nor used in that country. (Sehwani Incorporated and/or Benita’s Frites Inc.vs.
In-N-Out Burger, Inc. G.R. No. 171053, October 15, 2007)

13. A, a law student, photocopied two chapters of a book in Corporation Law written by
Professor X, his professor in the said subject. Professor X caught him using the photocopied
materials during a recitation in his Corporation Law class. Enraged, Professor X filed a case
for copyright infringement against A. The professor argued that A’s act produces substantial
economic injury on his part. For his part, A disputed the claim, arguing that what he did is
sanctioned by law under the principle of fair use because what he had was just a single copy
of the two chapters that he solely used for academic and personal purposes. Who has a
tenable argument between A and Professor X?

Professor X has a tenable argument. It does not necessarily require that the entire copyrighted work, or
even a large portion of it, be copied. If so much is taken that the value of the original work is
substantially diminished, there is an infringement of copyright and to an injurious extent, the work is
appropriated.

In determining the question of infringement, the amount of matter copied from the copyrighted work is
an important consideration. To constitute infringement, it is not necessary that the whole or even a large
portion of the work shall have been copied. If so much is taken that the value of the original is sensibly
diminished, or the labors of the original author are substantially and to an injurious extent appropriated
by another, that is sufficient in point of law to constitute piracy. (Habana vs. Robles, G.R. No. 131522, July 19,
1999)

14. C, the executive producer of Tara Na!, a reality backpacker show televised over ABS-
ZBM, brought a complaint for copyright infringement against ‘Lika Na U, D2 Na Me!, a
similarly formatted TV show aired over rival BMA7. Is ABS-ZBM’s copyright over Tara NA!?

No. The format or mechanics of a television show is not included in the list of protected works in Sec. 2
of PD No. 49 (now Sec. 172 and 173, IPC). For this reason, the protection afforded by the law cannot be
extended to cover them. Copyright, in the strict sense of the term, is purely a statutory right. It is a new
independent right granted by the statute and not simply a pre-existing right regulated by the statute.
Being a statutory grant, the rights are only such as the statute confers, and may be obtained and
enjoyed only with respect to the subjects and by the person and on terms and conditions specified in the
statute (Joaquin, Jr., and BJ Productions, Inc. vs. Drilon, 1999).

15. Does an infringement case constitute a prejudicial question to an unfair competition

case?

No. There is no prejudicial question since the two actions are independent of each of other. The basis of
an action for unfair competition is fraud, while that of infringement, the fact of registration.

There is no prejudicial question if the civil (infringement) and criminal (unfair competition) action can,
according to law, proceed independently of each other. Under Rule 111, Section 3 of the Revised Rules
on Criminal Procedure, in the cases provided in Articles 32, 33, 34 and 2176 of the Civil Code, the
independent civil action may be brought by the offended party. It shall proceed independently of the
criminal action and shall require only a preponderance of evidence. (Samson vs. Hon. Reynaldo B.
Daway, 2004)

16. X is a refilling station and sells LPG using the cylinders bearing the marks of Y without
the latter’s consent. Y sues X for trademark infringement and for unfair competition. X
contends that its customers know that X is but a refilling station. The customers themselves
know this fact since in most instances, the empty cylinders were merely swapped by
customers for which were already filled.

Is X liable for trademark infringement and unfair competition?

Yes. The mere unauthorized use of a container bearing a registered trademark in connection with the
sale, distribution or advertising of goods or services which is likely to cause confusion, mistake or
deception among the buyers or consumers can be considered as trademark infringement.

X has committed trademark infringement when it refilled, without the Y’s consent, the LPG containers
bearing the registered marks of Y. X’s acts will inevitably confuse the consuming public, since they have
no way of knowing that the gas contained in the LPG tanks bearing Y’s marks is in reality not X’s LPG
product after the same had been illegally refilled. The public will then be led to believe that X are
authorized refillers and distributors of Y’s LPG products, considering that they are accepting empty
containers of Y and refilling them for resale.
Also by refilling and selling LPG cylinders bearing their registered marks, petitioners are selling goods by
giving them the general appearance of goods of another manufacturer. (Republic Gas Corporation vs. Petron
Corporation, 698 SCRA 666, June 17, 2013)

17. PMSI was granted a legislative franchise to install, operate and maintain a nationwide
DTH satellite service. It delivers digital direct-to-home (DTH) television via satellite to its
subscribers all over the Philippines. When it actually started operation, it offered as part of
its program line-up ABS-CBN Channels 2 and 23, NBN, Channel 4, ABC Channel 5, GMA
Channel 7, RPN Channel 9, and IBC Channel 13, together with other paid premium program
channels. ABS-CBN then filed an action against for PMSI for the rebroadcast of of Channels 2
and 23 and thereby infringing the broadcasting rights and copyright of the former. Will the
action prosper?

No. Section 202.7 of the IP Code defines broadcasting as “the transmission by wireless means for the
public reception of sounds or of images or of representations thereof; such transmission by satellite is
also ‘broadcasting’ where the means for decrypting are provided to the public by the broadcasting
organization or with its consent.”

On the other hand, rebroadcasting as defined in Article 3(g) of the International Convention for the
Protection of Performers, Producers of Phonograms and Broadcasting Organizations, otherwise known as
the 1961 Rome Convention, of which the Republic of the Philippines is a signatory, 21 is “the
simultaneous broadcasting by one broadcasting organization of the broadcast of another broadcasting
organization.”

The transmission contemplated under Section 202.7 of the IP Code presupposes that the origin of the
signals is the broadcaster. Hence, a program that is broadcasted is attributed to the broadcaster. In the
same manner, the rebroadcasted program is attributed to the rebroadcaster.

In the case at hand, PMSI is not the origin nor does it claim to be the origin of the programs broadcasted
by ABS-CBN. Appellant did not make and transmit on its own but merely carried the existing signals of
ABS-CBN. When PMSI’s subscribers view ABS-CBN’s programs in Channels 2 and 23, they know that the
origin thereof was ABS-CBN.

That the medium through which the PMSI carries the ABS-CBN’s signal, that is via satellite, does not
diminish the fact that it operates and functions as a cable television. It remains that the PMSI’s
transmission of signals via its DTH satellite television service cannot be considered within the purview of
broadcasting. (ABS-CBN Broadcasting Corporation vs. Philippine Multi-Media System, Inc., G.R. Nos. 175769-70, January 19,
2009)

18. Are the Justices required to cite the authors of the passage they lifted when drafting a
decision?

No. Unlike academic publishing model which is based on the originality of the writer’s thesis, the judicial
system is based on the doctrine of stare decisis, which encourages courts to cite historical legal data,
precedents, and related studies in their decisions. The judge is not expected to produce original
scholarship in every respect. The strength of a decision lies in the soundness and general acceptance of
the precedents and long held legal opinions it draws from (In Re Plagiarism against Justice Del Castillo, [2010])