Abstract
The Taiwanese Patent Act foresaw from its inception in 1944 compulsory licence (CL) and government use. The provisions on the former have been amended several times, moving away from the Paris Convention model, while provisions on the latter were revised once, only to narrow its scope. Overall speaking, the regime on compulsory licensing and government use is in regress and fails to fulfil its function of balancing public and private interests. Thus far in Taiwan, two CL have been granted and implemented with the second being annulled later, and only one government use has been granted and yet not implemented due to its precondition not being satisfied. The Fair Trade Commission has not yet seen CL as one of the “necessary corrective measures” of the Fair Trade Act, although it did find violation of the Fair Trade Act in the Philips CD-R case.
K.-C. Liu is Professor of Law.
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Notes
- 1.
- 2.
The CL regime seemed only natural to the most authoritative commentator of that time, Yu-Fong Nin (who also served as head of the Patent Office). In his well-known thesis, Industrial Property Rights Law (in Chinese, 1st ed. 1972, p. 202 and again 3rd ed. 1982, p. 202), he just recited Article 67 without elaborating on it.
- 3.
Chen (1995), pp. 186–187.
- 4.
CBS (66) Tai Zhuan Cheng Er Tze 65589 (14 February 1978).
- 5.
MOEA (68) Gi 11239 (13 April 1979).
- 6.
CBS (69) Tai Zhuan Cheng Yi Tze 104993 (25 February 1980).
- 7.
MOEA (70) Su 14582 (17 April 1981).
- 8.
CBS (70) Tai Zhuan Cheng Yi Tze 126940 (6 November 1981).
- 9.
MOEA (71) Su 18908 (2 June 1982).
- 10.
The Executive Yuan Tai (71) SuTze 17491 (18 October 1982).
- 11.
The Supreme Administrative Court 1983 Pan-Tze 359 Decision (decided on 7 April 1983).
- 12.
Document of the Legislative Yuan of 1 January 1994, Second Congress, First Session, 48th Meeting. It has been widely accepted by the international IP community that Article 31 of the TRIPS Agreement imposes only a stringent procedural requirement but leaves Members leeway in deciding the grounds for issuing CL. For more details, see the chapter “The Use of Compulsory Licences in Latin America” by Carlos M. Correa, in this volume.
- 13.
However, some commentators lauded the provision as more “up to date”. See Chen (1997), p. 109.
- 14.
In 1997, an additional requirement was inserted into this Article: “the dependent invention or the method patent must ‘involve an important technical advancement of considerable economic significance in relation to the prior invention or product patent’”.
- 15.
For more details, see Liu (2011), pp. 83–104.
- 16.
The unsuccessful fate of the CL against Philips might have played a role in the withdrawal of the application because the applicant was also a local CD-R manufacturer.
- 17.
The JLA was declared a cartel agreement among competitors and banned by the Taiwanese Fair Trade Commission (TFTC). Accordingly, Philips, Sony, and Taiyo Yuden started to license their own patents separately despite the later Supreme Administrative Court decision that rejected the determination by the TFTC. For more details, see Liu (2011), pp. 86–87.
- 18.
For more details, see Liu (2011), p. 88.
- 19.
The TIPO Tzefatze No. 09618600360 (31 May 2007).
- 20.
For more details, see Liu (2011), p. 89.
- 21.
The European Union reacted strongly to the TIPO’s decision to grant compulsory licence against Philips and demanded that Taiwan revise provisions on compulsory licence and “ensure that precedential effects of the measures are eliminated, including ensuring that the compulsory licenses are revoked in their entirety” within 2 months from the transmission of the report to the TIPO. Under such threat, the TIPO undertook to revise the Patent Act.
- 22.
Theoretically, any violation of the Fair Trade Act, which is composed of antitrust and unfair competition law, would suffice. However, violation of the unfair competition provision alone would hardly justify the grant of a compulsory licence.
- 23.
Liu (2008), p. 67.
- 24.
See the chapter “Compulsory Licensing in Germany” by Philipp Maume, in this volume.
- 25.
- 26.
For a detailed discussion of the patent law of the UK, see Liu (2012), p. 688.
- 27.
Liu (2008), p. 67. Whether the alleged infringer of a patent can use CL as a defence against infringement claim only when the TIPO actually granted such licence beforehand remains to be clarified by courts.
- 28.
Liu (2011), p. 89.
- 29.
Liu (2008), pp. 68–70.
- 30.
For a detailed discussion of ancillary orders that are required to make the issued compulsory licence work, see the chapter “Ancillary Orders of Compulsory Licensing and Their Compatibility with the TRIPS Agreement” by Richard Li-dar Wang, in this volume.
- 31.
According to Chen (1995), p. 186, public interest should be interpreted broadly to include at least national defence, national health, medicines, food, and environmental protection.
- 32.
For a detailed discussion of the patent law of Germany, see Liu (2012), p. 689.
- 33.
Patent Declaration that “In determining the scope and duration of a compulsory license states should take into account the commercial interests of licensees. A Compulsory licensee should not be deprived of the possibility of obtaining reasonable compensation and an adequate return on investment. Otherwise, he or she will have no incentive to apply for a compulsory license in the first place.” (Paragraph 32).
- 34.
Shieh (2012), p. 49.
- 35.
Wilhelm in Fitzner/Lutz/Bodewig, PatRKomm, 4th ed., 2012, PatG § 24 Rn. 56; Benkard/Rogge, Patentgesetz, 10th ed., 2006 § 24, Rdnr. 33.
- 36.
For a detailed discussion, see Liu (2012), p. 696.
- 37.
However, some are still of the opinion that design patents are not related to public interest at all; see Yang (2003), p. 456.
- 38.
Section 238 provides: (1) Subsection (1A) applies where whatever needs to be remedied, mitigated or consists of or includes—(a) conditions in licences granted by an unregistered design right owner restricting the use of the design by the licensee or the right of the design right owner to grant other licences, or (b) a refusal of a design right owner to grant licences on reasonable terms. (1A) The powers (by the Secretary of State, the Competition Commission or the Office of Fair Trading) conferred by Schedule 8 to the Enterprise Act of 2002 include power to cancel or modify those conditions and, instead or in addition, to provide that licences in respect of the design right shall be available as of right. (3) The terms of a licence available by virtue of this section shall, in default of agreement, be settled by the comptroller. Section 270 provides the same powers exercisable for protection of the public interest when it comes to registered designs: (1) The registrar may by order cancel or modify any such condition or may, instead or in addition, make an entry in the register to the effect that licences in respect of the design are to be available as of right. (2) The terms of a licence available by virtue of this section shall, in default of agreement, be settled by the registrar on an application by the person requiring the licence; and terms so settled shall authorise the licensee to do everything which would be an infringement of the right in the registered design in the absence of a licence.
- 39.
Liu (2008), pp. 71–75.
- 40.
In 1999, an Emergency Order was issued by the President after a magnitude 7.3 earthquake hit Taiwan.
- 41.
However, the Taipei Administrative High Court was of a totally different opinion and was guided by the following facts: (1) the TFTC has determined the relevant market to be the “CD-R technology market”; (2) what the TFTC defined as CD-R is products produced in accordance with the standards specified in the Orange Book set up by Philips and Sony; (3) local CD-R manufacturers must use all the patents owned by Philips et al. in order to make CD-Rs; (4) using patents of any one of the three companies would not be sufficient to manufacture CD-Rs; (5) therefore, patents owned by Philips et al. were complementary in nature and every pooled patent was indispensable, which made the patented technology no longer substitutable, and no competition relationship could exist between Philips et al.
- 42.
The Supreme Administrative Court Pantze 553 of 2007 (4 April 2007).
- 43.
The TFTC Tzutze 098156 (29 October 2009).
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Liu, KC. (2015). Compulsory Licence and Government Use in Taiwan: A Regress. In: Hilty, R., Liu, KC. (eds) Compulsory Licensing. MPI Studies on Intellectual Property and Competition Law, vol 22. Springer, Berlin, Heidelberg. https://doi.org/10.1007/978-3-642-54704-1_5
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