Users keen on govt’s contract IP plan

Companies doing business with government departments should have a better idea of who will own the resulting intellectual property after a development contract is finished.

Companies doing business with government departments should have a better idea of who will own the resulting intellectual property after a development contract is finished.

The government has unveiled guidelines for the ownership of intellectual property when departments or ministries are negotiating the purchase of “research” from providers.

The guidelines are complementary to normal contract negotiations, says the Ministry of Research, Science and Technology, “intended to assist them rather than to supplant them”.

But in essence the government retains the right to own any IP “resulting from the research that it contemplates as a result of the research and that is specified as an output or deliverable in the contract”. MoRST is the primary adviser to the government on research and innovation.

The provider has a right to own any other IP which results, but was not contemplated by the department or ministry, at the time of contracting and that is not specified as an output or deliverable in the contract. Each party owns the IP they bring into a contract.

Intergen head Tony Stewart says the guidelines seem “logical” and “balanced”. They set the baseline to encourage commercialisation of IP and promote an open dialogue. Any attempt to hide IP results in trouble, he says. The only other time IP issues might get “messy”, says Stewart, is when a provider brings IP to the table and enhances it in the process of the contract.

Gen-i head Garth Biggs takes it as read that any IP delivered for a development contract, for example, is owned by the client, whether private or public-sector. An application developed for one bank, for example, couldn’t be sold to another, he says.

He wouldn’t expect a Crown entity to pay for the intellectual property developed for another, though they would be expected to pay for the implementation. If an Australian government department subsequently wanted a locally developed Crown application, however, a “conversation” would be had about IP.

IBM says through spokesman Jeremy Seed that in the context of ITANZ plans for a centre to take local applications and sell them offshore the general consensus in the company seems to be that the guidelines are “perfectly reasonable”.

MoRST said it did have software developments as well as pure research contracts in mind when drafting the guidelines, but did not respond in detail by deadline.

The slender MoRST paper — a page and a half — says the government sees commercialisation of IP from research as an important way to create benefits for New Zealand — and research providers as best placed to do this. If the department or ministry wants to use or exploit the IP it makes claim to, it should retain exclusive rights to the IP and make its intentions clear in the contract. It should, if requested by the provider, negotiate exclusive licensing rights, “unless it can show that such commercialisation is likely to be detrimental to the national benefit”.

David Irving, the president of ITANZ, thinks the concept of not withholding a commercialisation licence without good reason is sensible thinking. With minor rewording the guidelines would be very similar to ITANZ’s view.

Irving accepts that some developments might want to be kept secret. These might include immigration, customs and defence, he suggests. “Social service-type” applications, however, should be ripe for replication in other countries.

The MoRST paper says any licensing rights come with some restraints. The commissioning department maintains full access to the IP and full freedom to use it for any purpose. It can also restrain the provider from any subsequent use of commercialisation that it considers is likely to be detrimental to the national benefit.

Biggs felt that this last point might more specifically apply to pure research in, say, chemistry or biology, but had no view on whether it was appropriate.

The guidelines can be here under the Intellectual Property section.

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