WIPO-WTO JOINT WORKSHOP

INTELLECTUAL PROPERTY RIGHTS AND TRANSFER OF TECHNOLOGY

Monday 17, November 2003, WTO, 154 rue de Lausanne, Geneva

IPRs AND THE TRANSFER OF TECHNOLOGY –

AFRICAN CASE STUDY

Dr. David A. OkongwuDirector General

National Office for Technology Acquisition and Promotion (NOTAP), Abuja, Nigeria

OUTLINE

0. PROTOCOL / COURTESIES

1. INTRODUCTION

2. BACKGROUND OF TECHNOLOGY ACQUISITION IN NIGERIA

3. ANALYSIS OF TECHNOLOGY FLOWS TO NIGERIA

4. ROLE OF IPRs IN LATERAL TRANSFER OF TECHNOLOGY IN NIGERIA – COMMERCIALISATION OF R&D RESULTS

5. CONCLUDING REMARKS

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INTRODUCTION

Usefulness of IPRs in human development (industry, research, innovation, investment, planning, etc) is very well known.

encourage and safeguard creativity/ innovation

provide spur for development

encourage creation of public pool of data

promote investments in R&D

strategic and focal tool for planning – R&D and economic

encourage transfer of technology.

IPRs

?

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INTRODUCTION (Contd.)

Do IPRs hinder OR help Transfer of Technology ?

For Inflow of Technology and/or Innovation into an economy; the key consideration for the transferor (owner of IPR) is:

PROFIT (short-term, Long-term)

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INTRODUCTION (Contd.)

Do IPRs hinder OR help Transfer of Technology ?

Skill acquisition by indigenous personnel(dependence on foreign experts?)

Local Value Addition(local sourcing of raw materials, spare parts/components?)

Global competitiveness (ability to compete in export market?)

Credible indigenous research activities and innovation (strong local R&D infrastructure?)

Lateral transfer within the economy?

IMPORTANT

PARAMETERS

Cost of Technology(equitable Royalty or Lumpsum fees?)

Fair provisions (restrictive, obnoxious tie-in clauses, etc?)

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IPRs IN NIGERIA

• Registration of Industrial Property: by Registry of Trademarks, Patents and Industrial Design

(Ministry of Commerce).

• Copyright: by Ministry of Culture.

• Patents registered under formal examination.

• Member of WIPO, Paris Convention, Berne Convention (PCT, ARIPO under application)

• WIPO provides tremendous support for IP in Nigeria (Patent Office, NOTAP)

• Growing Awareness of IP in Nigeria

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BACKGROUND OF TECHNOLOGY ACQUISITION IN NIGERIA

The 1970s was an era of indiscriminate import of various technologies into Africa (developing countries: Nigeria especially).

Industrialisation efforts mainly of turnkey packages with no technological link to the environment. Un-coordinated technology inflows. International Code of Conduct on Transfer of Technology to developing countries was lacking.

Technology transfer contracts contained very unfair conditions: monopoly pricing; restrictive business practices; export

restrictions; high royalty rates; tie-in clauses (w.r.t equipment, raw materials, components, etc); little comprehensive training and management succession programmes; poor/weak local R&D activities, etc.

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BACKGROUND

Thus the National Office for Technology Acquisition and Promotion (NOTAP), formerly the National Office of Industrial Property (NOIP) was established in 1979 as a national agency for efficient acquisition (transfer) of technology under more equitable conditions.

The name was changed from NOIP to NOTAP in 1992, in order to:

i. ensure that new name adequately reflects its entire functions.

ii. avoid any misconception with regard to the activities of NOTAP and those of Registry of Patents and Trademarks.

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FUNCTIONS AND ACTIVITIES OF NOTAP

The major functions and activities of NOTAP include:-

Registration of all contracts for the transfer of foreign

technology to Nigerian Companies; and the monitoring the

execution of same.

Development of negotiating skill of Nigerians, for best

contractual terms and conditions in any contract for

transfer of foreign technology.

Promotion of innovation and IPR awareness among

researchers and inventors and Commercialization of useful R&D

results and inventions.9

GUIDELINES ON TRANSFER OF TECHNOLOGY

Published Technology Transfer Guidelines seek generally to: Ensure fair contracts. Encourage skill acquisition by indigenous staff. Discourage obnoxious clauses (export restrictions, materials

supply tie-in clauses, etc) Maintain equitable level of remuneration (Royalties: 1-5% Net Sales) Improve the quality of contracts submitted in order to facilitate their

registration

(1) Application Form with full data on Contract;

(2) Monitoring Form to indicate extent of implementation

Registration within 48 hours.

Since 1983, over 3000 Technology Transfer Contracts have been registered at NOTAP (as at October 2003).

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ANALYSIS OF TECHNOLOGY FLOWS TO NIGERIA

Charts and Figures from Technology Transfer Contracts (1983-2003) show:-

Forms of IPRs involved in Technology Transfer contracts

Level of Skill acquisition by indigenous staff (reflected by number of foreign personnel)

Extent of Local Value Addition,

Impact of IPRs on Export Capability

Cost of technology

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11a

Fig 1: TECHNOLOGY TRANSFER CONTRACTS AND TYPES OF COLLABORATION

0

20

40

60

80

100

120

140

160

83 84 85 86 87 88 89 90 91 92 93 94 95 96 97 98 99

2000

2001

2002

2003

Year

Co

llab

ora

tio

n T

ype

(No

s)

Trade Mark

Patent

Know How

Software

ManagementServicesConsultancy

(1983 – 2003)

Fig 2: IPR-BASED TECHNOLOGY TRANSFER CONTRACTS AS PERCENTAGE OF ALL TECHNOLOGY CONTRACTS

0

10

20

30

40

50

60

70

80

90

100

83 84 85 86 87 88 89 90 91 92 93 94 95 96 97 98 99 2000 2001 2002 2003

Year

Per

cen

tag

eof

Tec

hn

olo

gy

Co

ntr

act

11b

(1983 – 2003)

FIG. 3: NUMBER OF COMPANIES EXPORTING PRODUCTS

0

5

10

15

20

25

83 84 85 86 87 88 89 90 91 92 93 94 95 96 97 98 99 2000 2001 2002 2003

Year

No

. of

Co

mp

anie

s

11c

(1983 – 2003)

FIG 4: AVERAGE NUMBER OF FOREIGN PERSONNEL PER COMPANY FOR IPRs AND NON-IPRs TECHNOLOGY TRANSFER CONTRACTS

0

5

10

15

20

25

83 84 85 86 87 88 89 90 91 92 93 94 95 96 97 98 99 2000 2001 2002 2003

Year

Fo

reig

n P

erso

nn

el/C

om

pan

y

IPR

NonIPR

11d

(1983 – 2003)

Fig. 5 AVERAGE NUMBER OF FOREIGN PERSONNEL PER IPR-BASED CONTRACT

0

2

4

6

8

10

12

83 84 85 86 87 88 89 90 91 92 93 94 95 96 97 98 99 2000 2001 2002

Year

Av.

No

. of

Fo

reig

n P

erso

nn

el/C

on

trac

t

11e

(1983 – 2002)

KEY FINDINGS

Most (about 75%) of Technology Transfer Contracts involve IPRs (Know-How, Trademarks, Patents)

Non-IPR Technology Transfer contracts (Management Support-Services) only 25%

Know-How is predominant form (70%) of IPRs

Patents rarely feature, except in pharmaceuticals.

Companies that export products are those with Trademark contracts [WAMCO (subsidiary of Friesland Bv); PROCTOR & GAMBLE

Export Drive since 1999

IPRs Technology Transfer contracts have fewer foreign personnel

More foreign personnel in companies with Non-IPRs Technology Contracts (increased drive for FDI).

Most Non-IPRs technology transfer contracts involve WOS or MSH, generally to ensure control of Finance, Production, Marketing

departments.12

IPRs IN INTRA-NATIONAL TRANSFER OF TECHNOLOGY:- COMMERCIALIZATION OF RESEARCH RESULTS

Cite 3 Good EXAMPLES

1. BROWN SUGAR Process Technology

2. EATSET Auto-Transfusion Device

3. NIPRISAN Drug for Sickle Cell Anaemia

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BROWN SUGAR PROCESS TECHNOLOGY at Kona Mada, near Abuja.

Developed by the National Cereals Research Institute (NCRI) Badeggi, (1988); to process cane sugar into Brown Sugar.

Process tested (1996)

Identified by NOTAP at a Techmart (2000)

Patent applied for (July 2001) by NOTAP

Patent granted (June 2001)

Product certified by NAFDAC (August 2001)

With an MOU by NOTAP, NCRI and ADP (with Kona Mada Community) commercialisation of project agreed upon (February 2003).

10 tcd plant: 90 mt Brown Sugar, 97.5 mt Molasses (by-product) is being commissioned by NOTAP (December 2003).

A successful intra-national transfer of technology made possible by:

NOTAP’s intervention

IPR

Cooperation between NOTAP, NCRI and ADP (including the Kona Mada community)

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THE EATSET (Emergency Auto-Transfusion Set)

A device for recovering and re-infusion of a patient's own blood during surgery.

Developed by Brig (Dr) O. Ovadje, (1989). Clinical trials completed (1996) Patent filed (1996) with support of UNDP Patent issued at different times over a period of 3-6 months in 19 countries

(Japan, China, Taiwan, South Korea, India, Pakistan, Malaysia, UK, France, Algeria, Angola, Congo, Egypt, Ethiopia, Ghana, Nigeria, Rwanda, South Africa, Zimbabwe).

Being commercialised by Inventor with private sector support $1m factory, located at the Calabar Export Processing Zone, to start production (early 2004).

A successful intra-national transfer of technology made possible by:

IPR

Determination of the Inventor

Cooperation between the Inventor and private investors as well as Support from UNDP

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NIPRISAN - a drug for treatment of Sickle cell Anaemia

Developed by the National Institute for Pharmaceutical Research (NIPRD), Abuja.

Patent filed 1990 (Nigeria), 1997 (USA)

Patents granted by 1998 (USA and 44 countries)

US Patent No. 5,800,819

Clinical trials (1994 – 2002) Exclusive License granted to XECHEM Inc of USA (2002) by NIPRD

to manufacture drug. (Royalty: 7.5% NS)

Manufacture started at NIPRD facilities at Abuja (Jan. 2003) pending establishment of Independent manufacturing facilities.

A successful transfer of technology made possible by: IPR Licensing of IPR to XECHEM (a foreign Company) to manufacture

product locally. Support by UNDP

* Other promising research results: Anti malaria; Anti-AIDS; Ulcer & Fungal agents.

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CONCLUDING REMARKS

IPRs clearly provide platform for Transfer of Technology, BUT they do not by themselves guarantee Transfer of Technology

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CONCLUDING REMARKS (Contd.)

Nation must attain TECHNOLOGICAL THRESHOLD i.e.

possess requisite skill/capability

have Enabling Domestic Environment

possess Adequate Support Base

Need to revisit Art 66(2) of TRIPS “ Developed country Members shall provide incentives to enterprises and institutions in their territories for purpose of promoting and encouraging technology transfer to least-developed country Members, in order to enable them create a sound and viable technological base”.

THIS IS CRUCIAL.

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Thank You

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