An owner of a registered patent has the right to prevent others from using his or her claimed invention for a period of 20 years. However, the rights granted under a patent can be problematic when they are abused by its owner. Unless a patent owner can prove otherwise, the Patents Registrar may determine that a patent owner is abusing his or her rights when:
- The patent owner, under reasonable conditions, does not supply the full demand for a product in Israel. For example, distributing the product at much lower quantity of units than what is being requested.
- The patent owner disregards the public good by imposing unfair conditions for supplying a product, granting a production license or using it. For example, demanding unrealistic prices.
To avoid such situations, the Israeli Patent Law allows the Patents Registrar to issue compulsory licenses to use a patented invention. Any interested party can submit a request to the Patent Office to issue a compulsory license. The Patents Registrar may issue the license without the need for agreement from the patent owner.
When issuing a compulsory license, the Patents Registrar takes into consideration, among others, the following:
- The ability of the person who submitted the request to fix the problem. For example, supply the needed quantity of units.
- The public good – provide the public with access to the invention in Israel by way of production or import at the widest scope without delay.
- The right to reasonable compensation – the patent owner has the right to receive fair compensation for the use of the invention.
- Maintaining the rights of those who already have access to and who may be developing the invention in Israel.
- The status of the patent – the time that passed since the patent was registered and the steps taken by the patent owner to distribute the patent in Israel by way of production or import.
If a new invention is based on a previous patent and the patent owner refuses to grant a license, the Patents Registrar may issue a compulsory license, if the invention is a technical innovation with significant financial value. A compulsory license is exclusive to the individual who submitted and was granted the requested. In most cases, the individual who was granted the compulsory license will be ordered to compensate the patent owner at a certain rate. The patent owner is entitled to ask the Patents Registrar to review the compulsory license if certain circumstances change. Ask Dr. Sharona Lahav to learn more about the conditions and the process in issuing compulsory licenses.