In March 2014 significant changes to the Fourth Part of the Russian Civil Code (Civil Code) were approved (the Amendments) which deals with intellectual property issues. These Amendments, subject to some minor exclusions will become effective from 1 October 2014.
The Amendments set out the new rules and requirements applicable to the state registration of the results of intellectual activity (RIA), such as inventions, utility models, industrial designs and trademarks. These changes are of a technical nature and should be taken into consideration by patent attorneys when registering the RIA.
In addition, the Amendments have significantly changed the provisions regulating copyright law.
Selected important changes introduced by the Fourth Part of the Civil Code are set out below.
Pledge of the exclusive rights
Although the concept of a pledge of the exclusive right to RIA is not an innovation, the Amendments provide for more detailed regulation of the pledge.
For instance, the general terms of the Civil Code related to pledges will be applicable to the pledge of the use of exclusive rights of the RIA. The new changes provide that the pledgor during the term of the pledge agreement is allowed to use the appropriate RIA and dispose of it (excluding transferring legal title to the RIA) without the consent of the pledge holder (unless otherwise stated in the pledge agreement). In addition the pledgor is not allowed to transfer the legal title to the pledged RIA to a third party without the pledge holder’s consent (unless otherwise stated in the pledge agreement).
Transfer of the exclusive right to RIA and licence agreements
The Amendments directly provide that it is prohibited to transfer the exclusive right to RIA without compensation (the Prohibition). The Amendments directly envisage that granting free licences between legal entities is prohibited.
The Amendments state, where the exclusive right is granted by an exclusive licence, the Prohibition has worldwide effect for the duration of the exclusive right to use the RIA. However, it should be noted that the drafting in the Amendments is unclear as to what is meant by worldwide. In addition, it appears that technically where the appropriate right for the use of the RIA has been granted under a non-exclusive licence, there are no restrictions for the transfer of such licence on a free of charge basis between legal entities. This issue should be further analysed on the basis of the court practice after the Amendments have come into force.
The Amendments provide that remuneration for transfer of the exclusive right and/or the licence agreement in respect of RIA could be envisaged in various forms (e.g. lump-sum payments, periodic payments, percent deduction from the revenue, etc.).
Dependent invention, dependent utility model, dependent industrial design
The Amendments introduce a definition for a dependent invention; a dependent utility model; and a dependent industrial design. The Amendments require the consent of the owner of the main invention, utility model or industrial design and, without this consent, the inventions, utility models, or industrial designs defined as dependent cannot be used.
Effective period for the exclusive right to use an industrial design
In accordance with the Amendments, the effective period for the exclusive right to an industrial design was reduced from 15 years to 5 years. However, it will be possible to extend the effective period several times so that the total effective term, including all possible extensions, does not exceed 25 years.
Challenging of the patent certifying the invention, utility model or industrial design
The Amendments provide important new provisions related to the challenging of the patents certifying an invention, utility model or industrial design: it will be possible to challenge the appropriate patent not only during its effective term but also after its expiration. At this stage it is not possible to predict how court practice will interpret this new provision and it is for this reason that it is important to follow the practical implementation of this change.
Furthermore, the Amendments envisage that during the period that a patent for an invention is challenged, the patent holder will be able to file an application for transforming that patent into a patent for a utility model. Such application will be accepted only subject to the implementation of certain requirements.
Definition of know-how
The legal definition of know-how has been supplemented with a statement that for the purposes of protection of know-how it will be enough for the owner simply to take reasonable steps for procuring the confidentiality of the appropriate know-how. One of these steps could be the establishment of confidentially procedures for commercial secrecy in respect of the relevant know-how.
Trademark licence agreement
In addition to the general requirements applicable to all licence agreements regarding the use of the RIA, trademark, licence agreement should refer to the list of goods in respect of which the licensed trademark may be used (in accordance with the International classification of goods and services).