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The benefit of doubt

22 March 2022

The last days or weeks have seen an unprecedented wave of articles bearing on the status of intellectual property in Russia.

  • How to wind down patents in Russia over next 3 months (Mark Mathison)
  • Russia permits patent misappropriation from unfriendly countries (Jeffrey Morton)
  • Russia retaliates against sanctions by curtailing foreign owners’ IP rights (Osborne Clarke)
    • These are only some of the catchy titles that appear in the media. Unfortunately, the Russian media are not far behind in this race for false information:

      • The government nullified compensation to patent owners from unfriendly countries,
      • Prime Minister Mishustin nullified compensation to patent owners from unfriendly countries
      • The government waived payments for patents from unfriendly countries
        • These falsely interpret the events that are taking place.

          These are only a few of the examples from the media. Russian authors who write articles are not specializing in intellectual property and may not understand the import of the events that take place. Writers from other countries are mostly experts in intellectual property in their own countries. It is not clear whether they rely on Russian publications or falsely interpret the events that are taking place.

          I extend my thanks to Tobias Cohen Jehoram who sent me his article in “Legal Alert” - Russia takes measures against foreign intellectual property holders in response to sanctions. Tobias writes: The Russian Federation has also issued a decree allowing patent infringement without risk of liability for damages by all Russian companies if those patents were filed by any entity affiliated with countries “unfriendly” to Russia.

          The Decree No 299 of March 6, 2022 mentioned by Tobias introduces changes to another governmental decree (No 1767) specifying how compensation should be paid to patent owners. Decree No 299 indeed allows “0” compensation to patent owners for the use of a patent.

          The Decree No 1767 referred to in the Decree No 299 specifies that compensation should be paid to a patent owner in the amount of 0.5% of the proceeds of the user of the patent. However that decree refers in its turn to Article 1360 of the Civil Code.

          Article 1360. The Use of an Invention, Utility Model or Industrial Design in the Interests of National Security.

          1. The government of the Russian Federation has the right in the circumstances of extreme urgency, in order to ensure defense and security of the state, protection of life and health of people to decide on the use of an invention, utility model or industrial design without approval of the patent owner with due immediate notification of the patent owner and payment of commensurate compensation to him.
          2. The rules for determining the amount of compensation and the procedure of payment shall be approved by the government of the Russian Federation.
            1. Hence, if we go down to the basic document it is clear that 0.5 % compensation (Decree No 1767) or “0” compensation (Decree No 299) shall be paid only in relation to the circumstances outlined in Article 1360. So far, there has been one case one year ago only where an invention related to a drug for the treatment of Covid-19 was allowed to be used without patent owner’s permission.

              The government is not in haste to develop that practice.

              We do not know if there will be other IP allowed for the use without permission of the IP owner however we see that the government is not in haste to develop that practice.

              We have analyzed only one example of incorrect information. In this case we have been able to track back information from the “Legal Alert” article to the core of the problem while in other cases authors simply make allegations without giving themselves the trouble to cite the basic documents and explain the import thereof.

              It may not be excluded either that the authors may simply take false information from the Russian media not specializing in IP and make conclusions of their own without checking the facts.