New rules on temporary compulsory patent licensing in the event of national emergencies

On September 2, 2021, Bill No. 12/2021 was sanctioned with the purpose of amending the Brazilian Industrial Property Law (“BIPL”) in order to authorize the temporary compulsory licensing of patents and patent applications in the event of a national emergency. According to the proponents of the Bill, its intent is to accelerate the process of granting compulsory licenses during emergencies, including public health emergencies, declared by law or decree, as is the case of the pandemic caused by Covid-19.

It is worth noting, however, that the BIPL already provides a compulsory license mechanism in the event of a national emergency for patents granted which, in fact, is supported by the Federal Constitution and by international treaties on intellectual property. The Brazilian Intellectual Property Association (“ABPI”), in an open letter issued on August 25, 2021, expressly opposed the Bill and emphasized that “it is not necessary to change the law to have compulsory licensing”.

The big difference between the former text and the current one is the possibility of compulsory licensing of patent applications, i.e. applications that are still under examination.

Furthermore, with the changes made to the BIPL, procedural rules and deadlines were determined, establishing a Positive Duty to act on the part of the Executive Branch when declaring an emergency of national interest.

According to the text sanctioned by the President, the government will have the duty to publish, within 30 days of publication of this law, a list of product patents or product patent applications potentially needed to address the situation. The patent applications that are still within the 18-month secrecy period, as determined by the BIPL, will not be exempted from this situation and will be included in the list, which in itself generates a great deal of discussion.

It is important to highlight that the Bill provides for an exception to compulsory licensing, in cases where the competent authority, established by the Executive Branch, deems that the patent holders of these technologies and products have made objective commitments capable of ensuring that domestic demand will be met in conditions of volume, price, and term compatible with the emergency needs.

Demarest’s Intellectual Property and Innovation team is available to provide further information or clarification on this topic.