Intellectual PropertyThe Nigerian Patent System as an Information Source in National Economic Development

 

In most developing nations (including Nigeria) indigenous technological expertise is not sufficiently developed to meet local requirements. To meet their developmental needs, these countries rely heavily on the transfer to them of foreign technology by more developed nations. Bambo Adewopo, Developments and Reform, Nigeria’s commercial laws Essays in honour of Chief Dr Chris Ogunbanjo O.F.R, (Nelson, 1st edition, 2005, page80) Lanre Fagbohun and Bambo Adewopo.

Such transfer can be effected through foreign direct investments, joint venture agreements, licensing and franchising agreements or other similar schemes:

The Patent System and technology transfer

It has been asserted that the transfer of technology involves and can only be achieved by indigenous inventiveness by Nigerians arising from access to and knowledge of Patents, Designs and Trade Marks.

A viable patent system is meant to contribute to this process in many ways. Firstly, the patent registry is enriched through the wealth of information about new products and processes which are disclosed in the registration of patents, thereby encouraging the transfer of technological information. Harvard Law Review vol. 118 April 2005. This is made possible due to the disclosure function of the patent system. In addition, an interested indigenous entrepreneur can link up with appropriate right owners to procure a license to enable him exploit the invention. Bambo Adewopo, Developments and Reform, Nigeria’s commercial law s Essays in honour of Chief Dr Chris Ogunbanjo O.F.R, (Nelson, 1st edition, 2005, page79) Lanre Fagbaohun and Bambo Adewopo

The purpose of a patent license is to authorize the license to use an invention protected by a patent and it also provides authorization to the licensee to use an invention protected by a patent and it also provides authorization to the licensee and grants a set of exclusive rights including the use of the invention for manufacturing, selling or placing it on the market. Technology Transfer also called Transfer of Technology (TOT) and Technology Commercialisation, is the process of skill transferring, knowledge, technologies, methods of manufacturing, samples of manufacturing and facilities among  governments or universities and other institutions to ensure that scientific and technological developments are accessible to a wider range of users who can then further develop and exploit the technology into new products, processes, applications, materials or services. It is closely related to (and may arguably be considered a subset of) knowledge transfer. Wikipedia (http://en.wikipedia.org/wiki/Technology_transfer).  It often involves the use of Technology brokers who are people who have discovered how to bridge the disparate worlds and apply scientific concepts or processes to new situations or circumstances. Hargadon, Andrew. Harvard Business School Working Knowledge for Business Leaders , August 4, 2003.

The Nigeria Technology policy looks beyond the mere encouragement of technology flow to Nigeria but it also seeks to assist Nigerian enterprises to identify and select only foreign technology which is suited to local needs and requirements, and on the best contractual terms and conditions. In implementing the National Science and Technology polices the Federal Government of Nigeria established the Federal Ministry of science and Technology and various institutions including the National Office for Technology Acquisition and Promotion. These institutions have substantive mandates to ensure that science and technology are used to resolve socio-economic problems arising from the attendant problems that characterize under development.

Terms such as export restriction or prohibition clauses, by which production and sale of the patented product, or product obtained by the patented process is restricted only to the country of the transferee of the technology, these include clauses, where the transferor of the patented technology restricts the procurement of certain materials needed for explanation of the invention from sources other than itself. We also have “no challenge clauses”, where the transferee is precluded from challenging the validity of the patent under which the technology is transferred and restrictions on research and development of the transferred technology.

This last restriction inhibits local creativity in adapting foreign technology to suit the nation’s peculiar requirements and directly counters the objectives of the Technology policy.  However, The Patents and Designs Act prohibit the inclusion of such clauses in patent license agreements.

Section 23(3) provides that any clause in such a license is null and void in so far as it imposes on the licensee in the industrial and commercial field restrictions which do not derive from the rights conferred by the patent or are unnecessary for safeguarding those rights. The problem is that the registrar is not authorized to examine applications for registration of these agreements, to ensure compliance with Section 23(3) before granting the license, and in view of the limitations imposed on the Registrar’s power of examination under Section 4(2) it is possible this duty does not exist. The proviso to Section 23(3) substantially negates the efficacy of that section. As it permits the inclusion of clauses dealing with the following matters.

 

Limitations concerning the scope, extent, territory or duration of the exploitation of the patent of the quality or quantity of the product in connection with which with patent may be exploited;

 

Obligations imposed on the licensee to abstain from all acts capable of prejudicing the validity of the patent; and limitations justified by the interest of the licensor in the technically efficient exploitation of the subject of the patent.

It has been argued that these three exceptions can easily be utilized to justify export prohibition clause, no challenge clauses and tie-in-clauses respectively, with negative implications for indigenous technology development. Bambo Adewopo, Developments and Reform, Nigeria’s commercial laws Essays in honour of Chief Dr Chris Ogunbanjo O.F.R, (Nelson, 1st edition, 2005, page80) Lanre Fagbohun and Bambo Adewopo.

The aim of acquiring technology is to and the rapid industrialization of Nigeria which is a major objective of the government as a means to the attainment of higher levels of well-being of the people. The advancement of science and the development of a technological base are essential conditions of industrial growth. DR. (Mrs) Nasir “THE ROLE OF INDUSTRIAL PROPERTY IN ECONOMIC DEVELOPMENT” Modern Practice Journal of Finance and Investment Law MPJFIL vol. 6 No 3-4

 

DEVELOPMENT OF INDIGENOUS CAPABILITIES

Within the ambit of technology development, the patent system has three main objectives.

First, it serves as an instrument of justice to the inventors to reward his ingenuity, and enable him profit from his creativity without hindrance from imitators.Some people see the patent system as creating a social contract whereby the states as representing the community, grants a monopoly to the inventor to profit by his invention in return for his making the product available for general use during the terms of patent protection and for making the secret public so that all can exploit it when the patent expires.

To most, the system would seem simply to protect a piece of personal property, namely the product of the inventor’s intellectual effort, from theft. Paul Marett, Intellectual Property, Law London Sweet and Maxwell, 1996 at Pp. 1-2

The inventor of a useful product is a benefactor to his society because his invention constitutes an addition to the sum of human prosperity. By securing his title through its recognition and protection, the law seeks to encourage inventive activity and innovation in all spheres of human activity. The second objective is the enhancement of development through increased inventiveness and innovative activities resulting in the availability of new and improved products as well as more efficient processes which help to develop society in the industrial, technological and other sectors.

In order to encourage innovation, NOTAP renders support services to encourage innovation, NOTAP renders support services to transform, innovation which is commercializable into products goods and services. It also renders technology development services to inventors by advising and assisting to upgrade some R&D results or inventions submitted for patenting in order to meet the standard required by the Trade Marks and Patents Registry. NOTAP also produces industrial project profiles for potential entrepreneurs for the development for the development of Small and Medium scale Enterprises (SMEs) Section 3(2) of the Act

Thirdly, the patent system, by its requirement of clear and complete disclosure, serves as an information source to relevant industries. As other inventors and researchers can thus freely draw on, and utilize such information to further improve existing products and processes. The most commonly offered economic justification for the patent system is that it preserves the incentive for inventors to create, develop, and commercialize new technologies and innovations. Economists and legal commentators often invoke a second economic rationale for the patent system however: that it “serves to disseminate technological information, and that this accelerates the growth of productivity in the economy.

It is clear that the patent system can catalyse the attainment of technology and general socio-economic development. To translate this potential to practical utility, however, the patent law must be properly synchronized with the objective of the national technology policy, which is the strengthening of the technological base of the nation through the enhancement of national capability in science and technology.

The disclosure function of the patent system is premised on three assumptions. The first assumption is that the patent system encourages the disclosure of information that would otherwise remain secret.

 

The second assumption is that inventors look through the patent records searching for new ideas and technologies.

 

The third assumption is that innovators can find valuable information in the patent records. Bambo Adewopo: Developments and Reform, Nigeria’s commercial laws Essays in honour of Chief Dr Chris Ogunbanjo O.F.R, (Nelson, 1st edition, 2005, page86) Lanre Fagbohun and Bambo Adewopo

There is a need to strengthen our patent laws to enhance the implementation of the National Industrial and Technology Policies. Also, the patents Registry should be properly equipped and staffed to perform the technical, administrative, logistics and other functions required of patent offices worldwide.

 

The Efficacy of the System as an Information Source

A major advantage which the patent system has over trade secrets as a form of protection of technological know-how is the disclosure requirements of the system which ensure its potential efficacy as an important source of scientific information. William M A Landes and Richard A Posner, the Economic Structure of Intellectual Property Law (2003) page294

An important secondary purpose of the patent system, however, is to encourage disclosure of information about new technologies and innovations. Patents may help accelerate the process of cumulative innovations because they encourage inventors to patent and disclose small technological advances, allowing everyone in the field to build upon one another’s work continually. William M A Landes and Richard A Posner, the Economic Structure of Intellectual Property Law (2003) page294

The patent system also theoretically prevents wasteful duplication of the original inventor’s research because the patents not only disclose how to make and use the claimed invention, but also notify the public of the patentee’s exclusive rights to that technology. William M A Landes and Richard A Posner, the Economic Structure of Intellectual Property Law (2003) page294. By virtue of Section 3(2) (a) of the Act, in applying for a patent, a description of the relevant at the relevant information must be submitted. A description must be full, and disclose the invention in a manner sufficiently clear and complete to enable it to be put into effect by a person skilled in the art or held of knowledge to which the invention relates. Section 3(2) of the Act. By virtue of this provision, the patent register has the innate capacity of becoming a most valuable repository of scientific and technological information on the latest technology worldwide. Bambo Adewopo, Developments and Reform, Nigeria’s commercial laws Essays in honour of Chief Dr Chris Ogunbanjo O.F.R, (Nelson, 1st edition, 2005, page86) Lanre Fagbohun and Bambo Adewopo

The efficacy of the Nigerian Patent system in this regard is however severely limited in two respects. The Registrar is expressly precluded from examining the question of whether the description, which had been filed in respect of the patent application, satisfies the requirements of completeness and clarity under Section 3(2) of the Act. In the absence of such monitoring, patentees either wilfully or negligently flout this requirement. Rather than setting out precise and best methods of manufacture, they may give inadequate disclosure or opaque disclosures. Where a patentee does not disclose clearly and completely in compliance with Section 3(2) the available remedy is to challenge such a patent as an invalid one under the provisions of Section 9 of the Act. Where an indigenous inventor is unsure of the profitability of his invention, he may not devote his time or resources to pursue legal action for this purpose. Even where a compulsory license is granted, the licensee is unlikely be able to practically work the invention, without support or assistance from the patentee, this support is unlikely under those circumstances.

NEED FOR AN EXAMINATION SYSTEM: There is a pertinent need to introduce an examining system which assesses patent applications and ensures compliance with the disclosure requirements before the grant of a patent. This system will require skilled personnel. It would be good for the patent office to work in conjunction with university research terms and or any other competent body who will provide the required technical and specialized services necessary for the efficient performance of this function.

 

ACCESSIBILITY OF INFORMATION CONTAINED IN THE REGISTER OF PATENTS: Another limitation to the patent system as a source of information dissemination is the question of accessibility of information contained in the Register of Patents. The difficulty encountered in obtaining needed information and questionable value of what is retrieved, combine together to strip society of the benefit of the patent system as a fountain of scientific information, thereby limiting the effectiveness of the system as a vehicle for technological development.

NOTAP has been active in this regard with the creation of the Technical information Bulletin first published in January, 1996. The bulletin is a repository of technical information about sources and types of technology including details of expired patents when can be freely exploited. The World Intellectual Property organization (WIPO) has assisted NOTAP in establishing a Patent Information and Documentation Centre (PIDC). The Federal Government has also strengthened NOTAP by deploying appropriate skilled personnel to manage the (PIDC). The centre has a deposit of over one million technology in patent document stored in CD-ROMS. It has planned an on-line linkage with WIPO in Geneva. The PIDC also has the GLOBAL PAT CD-ROMS, which has made it possible to access technology information available in patent documents globally, specifically, the publications from 1971 to year 2000. Funke Araba “INTELLECTUAL PROPERTY REGIME, TECHNOLOGY TRANSFER AND INNOVATION CULTURE. PRE REQUISITES FOR ECONOMIC DEVELOPMENT IN NIGERIA,”MODUS INTERNATINAL: LAW and BUSINESS QUARTERLY Dec, 2001 vol. 6, No.4

Small and medium scale enterprises will be among the beneficiaries of a well-run patent system in Nigeria as they will be able to avail themselves of the benefits of  a viable patent system at no extra cost.

Conclusion

One of the key issues often neglected with transfer of technology is how to construct a receptor to capture the transferred technology and ensure that it is fully internalized to enable it blossom and grow to create similar new technologies on its own within a given time frame without external support. It is only then that technology can be said to be transferred. Without a deliberate receptor programme, technology transfer will continue to be by chance. Nigeria’s national R&D spending is very low with little verifiable statistics and little or no results to show.

There must be massive increase in R&D expenditure to yield appreciable results in innovation. Funding for R&D development would not come solely from government but it needs to create the enabling environment for research and development to thrive which will in turn birth innovation, for one it needs to solve the problem of epileptic power supply. This is a call for our nation and the need for all of us to work together to ensure that a vibrant “Innovative Culture” is established.

 

Megathos Law Practice  © 2012