Patents Act 1977

• (14) In this Act, except so far as the context otherwise requires—

• “register”, as a noun, means the register of patents;

• “register”, as a verb, means, in relation to any thing, to register or register particulars, or enter notice, of that thing in the register and, in relation to a person, means to enter his name in the register;

and cognate expressions shall be construed accordingly.

Effect of registration, etc., on rights in patents

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• (1) Any person who claims to have acquired the property in a patent or application for a patent by virtue of any transaction, instrument or event to which this section applies shall be entitled as against any other person who claims to have acquired that property by virtue of an earlier transaction, instrument or event to which this section applies if, at the time of the later transaction, instrument or event—

• (a) the earlier transaction, instrument or event was not registered, or

• (b) in the case of any application which has not been published, notice of the earlier transaction, instrument or event had not been given to the comptroller, and

• (c) in any case, the person claiming under the later transaction, instrument or event, did not know of the earlier transaction, instrument or event.

• (2) Subsection (1) above shall apply equally to the case where any person claims to have acquired any right in or under a patent or application for a patent, by virtue of a transaction, instrument or event to which this section applies, and that right is incompatible with any such right acquired by virtue of an earlier transaction, instrument or event to which this section applies.

• (3) This section applies to the following transactions, instruments and events:—

• (a) the assignment or assignation of a patent or application for a patent, or a right in it;

• (b) the mortgage of a patent or application or the granting of security over it;

• (c) the grant, assignment or assignation of a licence or sub-licence, or mortgage of a licence or sub-licence, under a patent or application;

• (d) the death of the proprietor or one of the proprietors of any such patent or application or any person having a right in or under a patent or application and the vesting by an assent of personal representatives of a patent, application or any such right; and

• (e) any order or directions of a court or other competent authority—

• (i) transferring a patent or application or any right in or under it to any person; or

• (ii) that an application should proceed in the name of any person;

and in either case the event by virtue of which the court or authority had power to make any such order or give any such directions.

• (4) Where an application for the registration of a transaction, instrument or event has been made, but the transaction, instrument or event has not been registered, then, for the purposes of subsection (1)(a) above, registration of the application shall be treated as registration of the transaction, instrument or event.

Rectification of register

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• (1) The court may, on the application of any person aggrieved, order the register to be rectified by the making, or the variation or deletion, of any entry in it.

• (2) In proceedings under this section the court may determine any question which it may be necessary or expedient to decide in connection with the rectification of the register.

• (3) Rules of court may provide for the notification of any application under this section to the comptroller and for his appearance on the application and for giving effect to any order of the court on the application.

Evidence of register, documents, etc.

35

Co-ownership of patents and applications for patents

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• (1) Where a patent is granted to two or more persons, each of them shall, subject to any agreement to the contrary, be entitled to an equal undivided share in the patent.

• (2) Where two or more persons are proprietors of a patent, then, subject to the provisions of this section and subject to any agreement to the contrary—

• (a) each of them shall be entitled, by himself or his agents, to do in respect of the invention concerned, for his own benefit and without the consent of or the need to account to the other or others, any act which would apart from this subsection and section 55 below, amount to an infringement of the patent concerned; and

• (b) any such act shall not amount to an infringement of the patent concerned.

• (3) Subject to the provisions of sections 8 and 12 above and section 37 below and to any agreement for the time being in force, where two or more persons are proprietors of a patent one of them shall not without the consent of the other or others

• (a) amend the specification of the patent or apply for such an amendment to be allowed or for the patent to be revoked, or amend the specification of the patent or apply for such an amendment to be allowed or for the patent to be revoked, or

• (b) grant a licence under the patent or assign or mortgage a share in the patent or in Scotland cause or permit security to be granted over it.

• (4) Subject to the provisions of those sections, where two or more persons are proprietors of a patent, anyone else may supply one of those persons with the means, relating to an essential element of the invention, for putting the invention into effect, and the supply of those means by virtue of this subsection shall not amount to an infringement of the patent.

• (5) Where a patented product is disposed of by any of two or more proprietors to any person, that person and any other person claiming through him shall be entitled to deal with the product in the same way as if it had been disposed of by a sole registered proprietor.

• (6) Nothing in subsection (1) or (2) above shall affect the mutual rights or obligations of trustees or of the personal representatives of a deceased person, or their rights or obligations as such.

• (7) The foregoing provisions of this section shall have effect in relation to an application for a patent which is filed as they have effect in relation to a patent and—

• (a) references to a patent and a patent being granted shall accordingly include references respectively to any such application and to the application being filed; and

• (b) the reference in subsection (5) above to a patented product shall be construed accordingly.

Determination of right to patent after grant

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• (1) After a patent has been granted for an invention any person having or claiming a proprietary interest in or under the patent may refer to the comptroller the question—

• (a) who is or are the true proprietor or proprietors of the patent,

• (b) whether the patent should have been granted to the person or persons to whom it was granted, or

• (c) whether any right in or under the patent should be transferred or granted to any other person or persons;

and the comptroller shall determine the question and make such order as he thinks fit to give effect to the determination.

• (2) Without prejudice to the generality of subsection (1) above, an order under that subsection may contain provision—

• (a) directing that the person by whom the reference is made under that subsection shall be included (whether or not to the exclusion of any other person) among the persons registered as proprietors of the patent;

• (b) directing the registration of a transaction, instrument or event by virtue of which that person has acquired any right in or under the patent;

• (c) granting any licence or other right in or under the patent;

• (d) directing the proprietor of the patent or any person having any right in or under the patent to do anything specified in the order as necessary to carry out the other provisions of the order.

• (3) If any person to whom directions have been given under subsection (2)(d) above fails to do anything necessary for carrying out any such directions within 14 days after the date of the order containing the directions, the comptroller may, on application made to him by any person in whose favour or on whose reference the order containing the directions was made, authorise him to do that thing on behalf of the person to whom the directions were given.

• (4) Where the comptroller finds on a reference under this section that the patent was granted to a person not entitled to be granted that patent (whether alone or with other persons) and on an application made under section 72 below makes an order on that ground for the conditional or unconditional revocation of the patent, the comptroller may order that the person by whom the application was made or his successor in title may, subject to section 76 below, make a new application for a patent—

• (a) in the case of unconditional revocation, for the whole of the matter comprised in the specification of that patent; and

• (b) in the case of conditional revocation, for the matter which in the opinion of the comptroller should be excluded from that specification by amendment under section 75 below;

and where such a new application is made, it shall be treated as having been filed on the date of filing the application for the patent to which the reference relates.

• (5) On any such reference no order shall be made under this section transferring the patent to which the reference relates on the ground that the patent was granted to a person not so entitled, and no order shall be made under subsection (4) above on that ground, if the reference was made after the second anniversary of the date of the grant, unless it is shown that any person registered as a proprietor of the patent knew at the time of the grant or, as the case may be, of the transfer of the patent to him that he was not entitled to the patent.

• (6) An order under this section shall not be so made as to affect the mutual rights or obligations of trustees or of the personal representatives of a deceased person, or their rights or obligations as such.

• (7) Where a question is referred to the comptroller under this section an order shall not be made by virtue of subsection (2) or under subsection (4) above on the reference unless notice of the reference is given to all persons registered as proprietor of the patent or as having a right in or under the patent, except those who are parties to the reference.

• (8) If it appears to the comptroller on a reference under this section that the question referred to him would more properly be determined by the court, he may decline to deal with it and, without prejudice to the court’s jurisdiction to determine any such question and make a declaration, or any declaratory jurisdiction of the court in Scotland, the court shall have jurisdiction to do so.

• (9) The court shall not in the exercise of any such declaratory jurisdiction determine a question whether a patent was granted to a person not entitled to be granted the patent if the proceedings in which the jurisdiction is invoked were commenced after the second anniversary of the date of the grant of the patent, unless it is shown that any person registered as a proprietor of the patent knew at the time of the grant or, as the case may be, of the transfer of the patent to him that he was not entitled to the patent.

Effect of transfer of patent under s. 37

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• (1) Where an order is made under section 37 above that a patent shall be transferred from any person or persons (the old proprietor or proprietors) to one or more persons (whether or not including an old proprietor), then, except in a case falling within subsection (2) below, any licences or other rights granted or created by the old proprietor or proprietors shall, subject to section 33 above and to the provisions of the order, continue in force and be treated as granted by the person or persons to whom the patent is ordered to be transferred (the new proprietor or proprietors).

• (2) Where an order is so made that a patent shall be transferred from the old proprietor or proprietors to one or more persons none of whom was an old proprietor (on the ground that the patent was granted to a person not entitled to be granted the patent), any licences or other rights in or under the patent shall, subject to the provisions of the order and subsection (3) below, lapse on the registration of that person or those persons as the new proprietor or proprietors of the patent.

• (3) Where an order is so made that a patent shall be transferred as mentioned in subsection (2) above or that a person other than an old proprietor may make a new application for a patent and before the reference of the question under that section resulting in the making of any such order is registered, the old proprietor or proprietors or a licensee of the patent, acting in good faith, worked the invention in question in the United Kingdom or made effective and serious preparations to do so, the old proprietor or proprietors or the licensee shall, on making a request to the new proprietor or proprietors or, as the case may be, the new applicant within the prescribed period, be entitled to be granted a licence (but not an exclusive licence) to continue working or, as the case may be, to work the invention, so far as it is the subject of the new application.

• (4) Any such licence shall be granted for a reasonable period and on reasonable terms.

• (5) The new proprietor or proprietors of the patent or, as the case may be, the new applicant or any person claiming that he is entitled to be granted any such licence may refer to the comptroller the question whether that person is so entitled and whether any such period is or terms are reasonable, and the comptroller shall determine the question and may, if he considers it appropriate, order the grant of such a licence.

Employees’ inventions

Right to employees' inventions

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• (1) Notwithstanding anything in any rule of law, an invention made by an employee shall, as between him and his employer, be taken to belong to his employer for the purposes of this Act and all other purposes if—

• (a) it was made in the course of the normal duties of the employee or in the course of duties falling outside his normal duties, but specifically assigned to him, and the circumstances in either case were such that an invention might reasonably be expected to result from the carrying out of his duties; or

• (b) the invention was made in the course of the duties of the employee and, at the time of making the invention, because of the nature of his duties and the particular responsibilities arising from the nature of his duties he had a special obligation to further the interests of the employer’s undertaking.

• (2) Any other invention made by an employee shall, as between him and his employer, be taken for those purposes to belong to the employee.

• (3) Where by virtue of this section an invention belongs, as between him and his employer, to an employee, nothing done—

• (a) by or on behalf of the employee or any person claiming under him for the purposes of pursuing an application for a patent, or

• (b) by any person for the purpose of performing or working the invention,

shall be taken to infringe any copyright or design right to which, as between him and his employer, his employer is entitled in any model or document relating to the invention.

Compensation of employees for certain inventions

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• (1) Where it appears to the court or the comptroller on an application made by an employee within the prescribed period that—

• (a) the employee has made an invention belonging to the employer for which a patent has been granted,

• (b) having regard among other things to the size and nature of the employer’s undertaking, the invention or the patent for it (or the combination of both) is of outstanding benefit to the employer, and

• (c) by reason of those facts it is just that the employee should be awarded compensation to be paid by the employer,

the court or the comptroller may award him such compensation of an amount determined under section 41 below.

• (2) Where it appears to the court or the comptroller on an application made by an employee within the prescribed period that—

• (a) a patent has been granted for an invention made by and belonging to the employee;

• (b) his rights in the invention, or in any patent or application for a patent for the invention, have since the appointed day been assigned to the employer or an exclusive licence under the patent or application has since the appointed day been granted to the employer;

• (c) the benefit derived by the employee from the contract of assignment, assignation or grant or any ancillary contract (“the relevant contract”) is inadequate in relation to the benefit derived by the employer from the invention or the patent for it (or both) ; and

• (d) by reason of those facts it is just that the employee should be awarded compensation to be paid by the employer in addition to the benefit derived from the relevant contract;

the court or the comptroller may award him such compensation of an amount determined under section 41 below.

• (3) Subsections (1) and (2) above shall not apply to the invention of an employee where a relevant collective agreement provides for the payment of compensation in respect of inventions of the same description as that invention to employees of the same description as that employee.

• (4) Subsection (2) above shall have effect notwithstanding anything in the relevant contract or any agreement applicable to the invention (other than any such collective agreement).

• (5) If it appears to the comptroller on an application under this section that the application involves matters which would more properly be determined by the court, he may decline to deal with it.

• (6) In this section—

• “the prescribed period”, in relation to proceedings before the court, means the period prescribed by rules of court, and

• “relevant collective agreement” means a collective agreement within the meaning of the Trade Union and Labour Relations (Consolidation) Act 1992, made by or on behalf of a trade union to which the employee belongs, and by the employer or an employers’ association to which the employer belongs which is in force at the time of the making of the invention.

• (7) References in this section to an invention belonging to an employer or employee are references to it so belonging as between the employer and the employee.

Amount of compensation

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• (1) An award of compensation to an employee under section 40(1) or (2) above shall be such as will secure for the employee a fair share (having regard to all the circumstances) of the benefit which the employer has derived, or may reasonably be expected to derive, from any of the following—

• (a) the invention in question;

• (b) the patent for the invention;

• (c) the assignment, assignation or grant of—

• (i) the property or any right in the invention, or

• (ii) the property in, or any right in or under, an application for the patent,

to a person connected with the employer.

• (2) For the purposes of subsection (1) above the amount of any benefit derived or expected to be derived by an employer from the assignment, assignation or grant of—

• (a) the property in, or any right in or under, a patent for the invention or an application for such a patent; or

• (b) the property or any right in the invention;

to a person connected with him shall be taken to be the amount which could reasonably be expected to be so derived by the employer if that person had not been connected with him.

• (3) Where the Crown, United Kingdom Research and Innovation or a Research Council in its capacity as employer assigns or grants the property in, or any right in or under, an invention, patent or application for a patent to a body having among its functions that of developing or exploiting inventions resulting from public research and does so for no consideration or only a nominal consideration, any benefit derived from the invention, patent or application by that body shall be treated for the purposes of the foregoing provisions of this section as so derived by the Crown, United Kingdom Research and Innovation or the Research Council (as the case may be).

In this subsection “Research Council” means a body which is a Research Council for the purposes of the Science and Technology Act 1965 ...

• (4) In determining the fair share of the benefit to be secured for an employee in respect of ... an invention which has always belonged to an employer, the court or the comptroller shall, among other things, take the following matters into account, that is to say—

• (a) the nature of the employee’s duties, his remuneration and the other advantages he derives or has derived from his employment or has derived in relation to the invention under this Act;

• (b) the effort and skill which the employee has devoted to making the invention;

• (c) the effort and skill which any other person has devoted to making the invention jointly with the employee concerned, and the advice and other assistance contributed by any other employee who is not a joint inventor of the invention; and

• (d) the contribution made by the employer to the making, developing and working of the invention by the provision of advice, facilities and other assistance, by the provision of opportunities and by his managerial and commercial skill and activities.

• (5) In determining the fair share of the benefit to be secured for an employee in respect of ... an invention which originally belonged to him, the court or the comptroller shall, among other things, take the following matters into account, that is to say—

• (a) any conditions in a licence or licences granted under this Act or otherwise in respect of the invention or the patent for it;

• (b) the extent to which the invention was made jointly by the employee with any other person; and

• (c) the contribution made by the employer to the making, developing and working of the invention as mentioned in subsection (4)(d) above.

• (6) Any order for the payment of compensation under section 40 above may be an order for the payment of a lump sum or for periodical payment, or both.

• (7) Without prejudice to section 12 or section 14 of the Interpretation Act 1978, the refusal of the court or the comptroller to make any such order on an application made by an employee under section 40 above shall not prevent a further application being made under that section by him or any successor in title of his.

• (8) Where the court or the comptroller has made any such order, the court or he may on the application of either the employer or the employee vary or discharge it or suspend any provision of the order and revive any provision so suspended, and section 40(5) above shall apply to the application as it applies to an application under that section.

• (9) In England and Wales any sums awarded by the comptroller under section 40 above shall, if the county court so orders, be recoverable under section 85 of the County Courts Act 1984 or otherwise as if they were payable under an order of that court.

• (10) In Scotland an order made under section 40 above by the comptroller for the payment of any sums may be enforced in like manner as an extract registered decree arbitral bearing a warrant for execution issued by the sheriff court of any sheriffdom in Scotland..

• (11) In Northern Ireland an order made under section 40 above by the comptroller for the payment of any sums may be enforced as if it were a money judgment.

Enforceability of contracts relating to employees' inventions

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• (1) This section applies to any contract (whenever made) relating to inventions made by an employee, being a contract entered into by him—

• (a) with the employer (alone or with another); or

• (b) with some other person at the request of the employer or in pursuance of the employee’s contract of employment.

• (2) Any term in a contract to which this section applies which diminishes the employee’s rights in inventions of any description made by him after the appointed day and the date of the contract, or in or under patents for those inventions or applications for such patents, shall be unenforceable against him to the extent that it diminishes his rights in an invention of that description so made, or in or under a patent for such an invention or an application for any such patent.

• (3) Subsection (2) above shall not be construed as derogating from any duty of confidentiality owed to his employer by an employee by virtue of any rule of law or otherwise.

• (4) This section applies to any arrangement made with a Crown employee by or on behalf of the Crown as his employer as it applies to any contract made between an employee and an employer other than the Crown, and for the purposes of this section “Crown employee” means a person employed under or for the purposes of a government department or any officer or body exercising on behalf of the Crown functions conferred by any enactment or a person serving in the naval, military or air forces of the Crown.

Supplementary

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• (1) Sections 39 to 42 above shall not apply to an invention made before the appointed day.

• (2) Sections 39 to 42 above shall not apply to an invention made by an employee unless at the time he made the invention one of the following conditions was satisfied in his case, that is to say—

• (a) he was mainly employed in the United Kingdom; or

• (b) he was not mainly employed anywhere or his place of employment could not be determined, but his employer had a place of business in the United Kingdom to which the employee was attached, whether or not he was also attached elsewhere.

• (3) In sections 39 to 42 above and this section, except so far as the context otherwise requires, references to the making of an invention by an employee are references to his making it alone or jointly with any other person, but do not include references to his merely contributing advice or other assistance in the making of an invention by another employee.

• (4) Any references in sections 39 to 42 above to a patent and to a patent being granted are respectively references to a patent or other protection and to its being granted whether under the law of the United Kingdom or the law in force in any other country or under any treaty or international convention.

• (5) For the purposes of sections 40 and 41 above the benefit derived or expected to be derived by an employer from an invention or patent shall, where he dies before any award is made under section 40 above in respect of it , include any benefit derived or expected to be derived from it by his personal representatives or by any person in whom it was vested by their assent.

• (5A) For the purposes of sections 40 and 41 above the benefit derived or expected to be derived by an employer from an invention shall not include any benefit derived or expected to be derived from the invention after the patent for it has expired or has been surrendered or revoked.

• (6) Where an employee dies before an award is made under section 40 above in respect of a patented invention made by him, his personal representatives or their successors in title may exercise his right to make or proceed with an application for compensation under subsection (1) or (2) of that section.

• (7) In sections 40 and 41 above and this section “benefit” means benefit in money or money’s worth.

• (8) Section 533 of the Income and Corporation Taxes Act 1970 (definition of connected persons) shall apply for determining for the purposes of section 41(2) above whether one person is connected with another as it applies for determining that question for the purposes of the Tax Acts.

Contracts as to patented products, etc.

Avoidance of certain restrictive conditions

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Determination of parts of certain contracts

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Licences of right and compulsory licences

Patentee's application for entry in register that licences are available as of right

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• (1) At any time after the grant of a patent its proprietor may apply to the comptroller for an entry to be made in the register to the effect that licences under the patent are to be available as of right.

• (2) Where such an application is made, the comptroller shall give notice of the application to any person registered as having a right in or under the patent and, if satisfied that the proprietor of the patent is not precluded by contract from granting licences under the patent, shall make that entry.

• (3) Where such an entry is made in respect of a patent—

• (a) any person shall, at any time after the entry is made, be entitled as of right to a licence under the patent on such terms as may be settled by agreement or, in default of agreement, by the comptroller on the application of the proprietor of the patent or the person requiring the licence;

• (b) the comptroller may, on the application of the holder of any licence granted under the patent before the entry was made, order the licence to be exchanged for a licence of right on terms so settled;

• (c) if in proceedings for infringement of the patent (otherwise than by the importation of any article from a country which is not a member State of the European Economic Community) the defendant or defender undertakes to take a licence on such terms, no injunction or interdict shall be granted against him and the amount (if any) recoverable against him by way of damages shall not exceed double the amount which would have been payable by him as licensee if such a licence on those terms had been granted before the earliest infringement;

• (d) if the expiry date in relation to a renewal fee falls after the date of the entry, that fee shall be half the fee which would be payable had the entry not been made.

• (3A) An undertaking under subsection (3)(c) above may be given at any time before final order in the proceedings, without any admission of liability.

• (3B) For the purposes of subsection (3)(d) above the expiry date in relation to a renewal fee is the day at the end of which, by virtue of section 25(3) above, the patent in question ceases to have effect if that fee is not paid.

• (4) The licensee under a licence of right may (unless, in the case of a licence the terms of which are settled by agreement, the licence otherwise expressly provides) request the proprietor of the patent to take proceedings to prevent any infringement of the patent; and if the proprietor refuses or neglects to do so within two months after being so requested, the licensee may institute proceedings for the infringement in his own name as if he were proprietor, making the proprietor a defendant or defender.

• (5) A proprietor so added as defendant or defender shall not be liable for any costs or expenses unless he enters an appearance and takes part in the proceedings.

Cancellation of entry made under s. 46

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• (1) At any time after an entry has been made under section 46 above in respect of a patent, the proprietor of the patent may apply to the comptroller for cancellation of the entry.

• (2) Where such an application is made and the balance paid of all renewal fees which would have been payable if the entry had not been made, the comptroller may cancel the entry, if satisfied that there is no existing licence under the patent or that all licensees under the patent consent to the application.

• (3) Within the prescribed period after an entry has been made under section 46 above in respect of a patent, any person who claims that the proprietor of the patent is, and was at the time of the entry, precluded by a contract in which the claimant is interested from granting licences under the patent may apply to the comptroller for cancellation of the entry.

• (4) Where the comptroller is satisfied, on an application under subsection (3) above, that the proprietor of the patent is and was so precluded, he shall cancel the entry; and the proprietor shall then be liable to pay, within a period specified by the comptroller, a sum equal to the balance of all renewal fees which would have been payable if the entry had not been made, and the patent shall cease to have effect at the expiration of that period if that sum is not so paid.

• (5) Where an entry is cancelled under this section, the rights and liabilities of the proprietor of the patent shall afterwards be the same as if the entry had not been made.

• (6) Where an application has been made under this section, then—

• (a) in the case of an application under subsection (1) above, any person, and

• (b) in the case of an application under subsection (3) above, the proprietor of the patent,

may within the prescribed period give notice to the comptroller of opposition to the cancellation; and the comptroller shall, in considering the application, determine whether the opposition is justified.

Compulsory licences

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• (1) At any time after the expiration of three years, or of such other period as may be prescribed, from the date of the grant of a patent, any person may apply to the comptroller on one or more of the relevant grounds–

• (a) for a licence under the patent;

• (b) for an entry to be made in the register to the effect that licences under the patent are to be available as of right; or

• (c) where the applicant is a government department, for the grant to any person specified in the application of a licence under the patent.

• (2) Subject to sections 48A and 48B below, if he is satisfied that any of the relevant grounds are established, the comptroller may–

• (a) where the application is under subsection (1)(a) above, order the grant of a licence to the applicant on such terms as the comptroller thinks fit;

• (b) where the application is under subsection (1)(b) above, make such an entry as is there mentioned;

• (c) where the application is under subsection (1)(c) above, order the grant of a licence to the person specified in the application on such terms as the comptroller thinks fit.

• (3) An application may be made under this section in respect of a patent even though the applicant is already the holder of a licence under the patent; and no person shall be estopped or barred from alleging any of the matters specified in the relevant grounds by reason of any admission made by him, whether in such a licence or otherwise, or by reason of his having accepted a licence.

• (4) In this section “the relevant grounds” means–

• (a) in the case of an application made in respect of a patent whose proprietor is a WTO proprietor, the grounds set out in section 48A(1) below;

• (b) in any other case, the grounds set out in section 48B(1) below.

• (5) A proprietor is a WTO proprietor for the purposes of this section and sections 48A, 48B, 50 and 52 below if–

• (a) he is a national of, or is domiciled in, a country which is a member of the World Trade Organisation; or

• (b) he has a real and effective industrial or commercial establishment in such a country.

• (6) A rule prescribing any such other period under subsection (1) above shall not be made unless a draft of the rule has been laid before, and approved by resolution of, each House of Parliament.

Provisions about licences under s. 48

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• (1) Where the comptroller is satisfied, on an application made under section 48 above in respect of a patent, that the manufacture, use or disposal of materials not protected by the patent is unfairly prejudiced by reason of conditions imposed by the proprietor of the patent on the grant of licences under the patent, or on the disposal or use of the patented product or the use of the patented process, he may (subject to the provisions of that section) order the grant of licences under the patent to such customers of the applicant as he thinks fit as well as to the applicant.

• (2) Where an application under section 48 above is made in respect of a patent by a person who holds a licence under the patent, the comptroller—

• (a) may, if he orders the grant of a licence to the applicant, order the existing licence to be cancelled, or

• (b) may, instead of ordering the grant of a licence to the applicant, order the existing licence to be amended.

• (3) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

• (4) Section 46(4) and (5) above shall apply to a licence granted in pursuance of an order under section 48 above and to a licence granted by virtue of an entry under that section as it applies to a licence granted by virtue of an entry under section 46 above.

Exercise of powers on applications under s. 48

50

• (1) The powers of the comptroller on an application under section 48 above in respect of a patent whose proprietor is not a WTO proprietor shall be exercised with a view to securing the following general purposes:—

• (a) that inventions which can be worked on a commercial scale in the United Kingdom and which should in the public interest be so worked shall be worked there without undue delay and to the fullest extent that is reasonably practicable;

• (b) that the inventor or other person beneficially entitled to a patent shall receive reasonable remuneration having regard to the nature of the invention;

• (c) that the interests of any person for the time being working or developing an invention in the United Kingdom under the protection of a patent shall not be unfairly prejudiced.

• (2) Subject to subsection (1) above, the comptroller shall, in determining whether to make an order or entry in pursuance of any application under section 48 above, take account of the following matters, that is to say—

• (a) the nature of the invention, the time which has elapsed since the publication in the journal of a notice of the grant of the patent and the measures already taken by the proprietor of the patent or any licensee to make full use of the invention;

• (b) the ability of any person to whom a licence would be granted under the order concerned to work the invention to the public advantage; and

• (c) the risks to be undertaken by that person in providing capital and working the invention if the application for an order is granted,

but shall not be required to take account of matters subsequent to the making of the application.

Application by Crown in cases of monopoly or merger

51

• (1) Where a report of the Competition and Markets Authority has been laid before Parliament containing conclusions to the effect—

• (a) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

• (b) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

• (c) on a competition reference, that a person was engaged in an anti-competitive practice which operated or may be expected to operate against the public interest, or

• (d) on a reference under section 11 of the Competition Act 1980 (reference of public bodies and certain other persons), that a person is pursuing a course of conduct which operates against the public interest,

the appropriate Minister or Ministers may apply to the comptroller to take action under this section.

• (2) Before making an application the appropriate Minister or Ministers shall publish, in such manner as he or they think appropriate, a notice describing the nature of the proposed application and shall consider any representations which may be made within 30 days of such publication by persons whose interests appear to him or them to be affected.

• (3) If on an application under this section it appears to the comptroller that the matters specified in the Competition and Markets Authority’s report as being those which in the opinion of the Competition and Markets Authority operate, or operated or may be expected to operate, against the public interest include—

• (a) conditions in licences granted under a patent by its proprietor restricting the use of the invention by the licensee or the right of the proprietor to grant other licences, or

• (b) a refusal by the proprietor of a patent to grant licences on reasonable terms

he may by order cancel or modify any such condition or may, instead or in addition, make an entry in the register to the effect that licences under the patent are to be available as of right.

• (4) In this section “the appropriate Minister or Ministers”means the Minister or Ministers to whom the report of the Competition and Markets Authority was made.

Opposition, appeal and arbitration

52

• (1) The proprietor of the patent concerned or any other person wishing to oppose an application under sections 48 to 51 above may, in accordance with rules, give to the comptroller notice of opposition; and the comptroller shall consider any opposition in deciding whether to grant the application.

• (2) Where an order or entry has been made under section 48 above in respect of a patent whose proprietor is a WTO proprietor–

• (a) the proprietor or any other person may, in accordance with rules, apply to the comptroller to have the order revoked or the entry cancelled on the grounds that the circumstances which led to the making of the order or entry have ceased to exist and are unlikely to recur;

• (b) any person wishing to oppose an application under paragraph (a) above may, in accordance with rules, give to the comptroller notice of opposition; and

• (c) the comptroller shall consider any opposition in deciding whether to grant the application.

• (3) If it appears to the comptroller on an application under subsection (2)(a) above that the circumstances which led to the making of the order or entry have ceased to exist and are unlikely to recur, he may–

• (a) revoke the order or cancel the entry; and

• (b) terminate any licence granted to a person in pursuance of the order or entry subject to such terms and conditions as he thinks necessary for the protection of the legitimate interests of that person.

• (4) Where an appeal is brought–

• (a) from an order made by the comptroller in pursuance of an application under sections 48 to 51 above;

• (b) from a decision of his to make an entry in the register in pursuance of such an application;

• (c) from a revocation or cancellation made by him under subsection (3) above; or

• (d) from a refusal of his to make such an order, entry, revocation or cancellation,

the Attorney General, the appropriate Law Officer within the meaning of section 4A of the Crown Suits (Scotland) Act 1857 or the Attorney General for Northern Ireland, or such other person who has a right of audience as any of them may appoint, shall be entitled to appear and be heard.

• (5) Where an application under sections 48 to 51 above or subsection (2) above is opposed, and either–

• (a) the parties consent, or

• (b) the proceedings require a prolonged examination of documents or any scientific or local investigation which cannot in the opinion of the comptroller conveniently be made before him,

the comptroller may at any time order the whole proceedings, or any question or issue of fact arising in them, to be referred to an arbitrator or arbiter agreed on by the parties or, in default of agreement, appointed by the comptroller.

• (6) Where the whole proceedings are so referred, unless the parties otherwise agree before the award of the arbitrator or arbiter is made, an appeal shall lie from the award to the court.

• (7) Where a question or issue of fact is so referred, the arbitrator or arbiter shall report his findings to the comptroller.

Compulsory licences; supplementary provisions

53

• (1) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

• (2) In any proceedings on an application made under section 48 above in respect of a patent, any statement with respect to any activity in relation to the patented invention, or with respect to the grant or refusal of licences under the patent, contained in a report of the Competition and Markets Authority laid before Parliament under Part VII of the Fair Trading Act 1973 or section 17 of the Competition Act 1980 or published under Part 3 or 4 of the Enterprise Act 2002 shall be prima facie evidence of the matters stated, and in Scotland shall be sufficient evidence of those matters.

• (3) The comptroller may make an entry in the register under sections 48 to 51 above notwithstanding any contract which would have precluded the entry on the application of the proprietor of the patent under section 46 above.

• (4) An entry made in the register under sections 48 to 51 above shall for all purposes have the same effect as an entry made under section 46 above.

• (5) No order or entry shall be made in pursuance of an application under sections 48 to 51 above which would be at variance with any treaty or international convention to which the United Kingdom is a party.

Special provisions where patented invention is being worked abroad

54

• (1) Her Majesty may by Order in Council provide that the comptroller may not (otherwise than for purposes of the public interest) make an order or entry in respect of a patent in pursuance of an application under sections 48 to 51 above if the invention concerned is being commercially worked in any relevant country specified in the Order and demand in the United Kingdom for any patented product resulting from that working is being met by importation from that country.

• (2) In subsection (1) above “relevant country” means a country other than a member state or a member of the World Trade Organisation whose law in the opinion of Her Majesty in Council incorporates or will incorporate provisions treating the working of an invention in, and importation from, the United Kingdom in a similar way to that in which the Order in Council would (if made) treat the working of an invention in, and and importation from, that country.

Use of patented inventions for services of the Crown

Use of patented inventions for services of the Crown

55

• (1) Notwithstanding anything in this Act, any government department and any person authorised in writing by a government department may, for the services of the Crown and in accordance with this section, do any of the following acts in the United Kingdom in relation to a patented invention without the consent of the proprietor of the patent, that is to say—

• (a) where the invention is a product, may—

• (i) make, use, import or keep the product, or sell or offer to sell it where to do so would be incidental or ancillary to making, using, importing or keeping it; or

• (ii) in any event, sell or offer to sell it for foreign defence purposes or for the production or supply of specified drugs and medicines, or dispose or offer to dispose of it (otherwise than by selling it) for any purpose whatever;

• (b) where the invention is a process, may use it or do in relation to any product obtained directly by means of the process anything mentioned in paragraph (a) above;

• (c) without prejudice to the foregoing, where the invention or any product obtained directly by means of the invention is a specified drug or medicine, may sell or offer to sell the drug or medicine;

• (d) may supply or offer to supply to any person any of the means, relating to an essential element of the invention, for putting the invention into effect;

• (e) may dispose or offer to dispose of anything which was made, used, imported or kept in the exercise of the powers conferred by this section and which is no longer required for the purpose for which it was made, used, imported or kept (as the case may be),

and anything done by virtue of this subsection shall not amount to an infringement of the patent concerned.

• (2) Any act done in relation to an invention by virtue of this section is in the following provisions of this section referred to as use of the invention; and “use”, in relation to an invention, in sections 56 to 58 below shall be construed accordingly.

• (3) So far as the invention has before its priority date been duly recorded by or tried by or on behalf of a government department or the United Kingdom Atomic Energy Authority otherwise than in consequence of a relevant communication made in confidence, any use of the invention by virtue of this section may be made free of any royalty or other payment to the proprietor.

• (4) So far as the invention has not been so recorded or tried, any use of it made by virtue of this section at any time either—

• (a) after the publication of the application for the patent for the invention; or

• (b) without prejudice to paragraph (a) above, in consequence of a relevant communication made after the priority date of the invention otherwise than in confidence;

shall be made on such terms as may be agreed either before or after the use by the government department and the proprietor of the patent with the approval of the Treasury or as may in default of agreement be determined by the court on a reference under section 58 below.

• (5) Where an invention is used by virtue of this section at any time after publication of an application for a patent for the invention but before such a patent is granted, and the terms for its use agreed or determined as mentioned in subsection (4) above include terms as to payment for the use, then (notwithstanding anything in those terms) any such payment shall be recoverable only—

• (a) after such a patent is granted; and

• (b) if (apart from this section) the use would, if the patent had been granted on the date of the publication of the application, have infringed not only the patent but also the claims (as interpreted by the description and any drawings referred to in the description or claims) in the form in which they were contained in the application immediately before the preparations for its publication were completed by the Patent Office.

• (6) The authority of a government department in respect of an invention may be given under this section either before or after the patent is granted and either before or after the use in respect of which the authority is given is made, and may be given to any person whether or not he is authorised directly or indirectly by the proprietor of the patent to do anything in relation to the invention.

• (7) Where any use of an invention is made by or with the authority of a government department under this section, then, unless it appears to the department that it would be contrary to the public interest to do so, the department shall notify the proprietor of the patent as soon as practicable after the second of the following events, that is to say, the use is begun and the patent is granted, and furnish him with such information as to the extent of the use as he may from time to time require.

• (8) A person acquiring anything disposed of in the exercise of powers conferred by this section, and any person claiming through him, may deal with it in the same manner as if the patent were held on behalf of the Crown.

• (9) In this section “relevant communication”, in relation to an invention, means a communication of the invention directly or indirectly by the proprietor of the patent or any person from whom he derives title.

• (10) Subsection (4) above is without prejudice to any rule of law relating to the confidentiality of information.

• (11) In the application of this section to Northern Ireland, the reference in subsection (4) above to the Treasury shall, where the government department referred to in that subsection is a department of the Government of Northern Ireland, be construed as a reference to the Department of Finance for Northern Ireland.

Interpretation, etc., of provisions about Crown use

56

• (1) Any reference in section 55 above to a patented invention, in relation to any time, is a reference to an invention for which a patent has before that time been, or is subsequently, granted.

• (2) In this Act, except so far as the context otherwise requires, “the services of the Crown” includes—

• (a) the supply of anything for foreign defence purposes;

• (b) the production or supply of specified drugs and medicines; and

• (c) such purposes relating to the production or use of atomic energy or research into matters connected therewith as the Secretary of State thinks necessary or expedient;

and “use for the services of the Crown” shall be construed accordingly.

• (3) In section 55(1)(a) above and subsection (2)(a) above, references to a sale or supply of anything for foreign defence purposes are references to a sale or supply of the thing—

• (a) to the government of any country outside the United Kingdom, in pursuance of an agreement or arrangement between Her Majesty’s Government in the United Kingdom and the government of that country, where the thing is required for the defence of that country or of any other country whose government is party to any agreement or arrangement with Her Majesty’s Government in respect of defence matters; or

• (b) to the United Nations, or to the government of any country belonging to that organisation, in pursuance of an agreement or arrangement between Her Majesty’s Government and that organisation or government, where the thing is required for any armed forces operating in pursuance of a resolution of that organisation or any organ of that organisation.

• (4) For the purposes of section 55(1)(a) and (c) above and subsection (2)(b) above, specified drugs and medicines are drugs and medicines which are both—

• (a) required for the provision of—

• (ai) primary medical services under the National Health Service Act 2006, the National Health Service (Wales) Act 2006, Part 1 of the National Health Service (Scotland) Act 1978 or any corresponding provisions of the law in force in Northern Ireland or the Isle of Man or primary dental services under the National Health Service Act 2006, the National Health Service (Wales) Act 2006 , or any corresponding provisions of the law in force in Northern Ireland or the Isle of Man, or

• (i) pharmaceutical services, general medical services or general dental services under Chapter 1 of Part 7 of the National Health Service Act 2006 or Chapter 1 of Part 7 of the National Health Service (Wales) Act 2006 (in the case of pharmaceutical services) , Part II of the National Health Service (Scotland) Act 1978 (in the case of pharmaceutical services or general dental services), or the corresponding provisions of the law in force in Northern Ireland or the Isle of Man, or

• (ii) personal medical services or personal dental services provided in accordance with arrangements made under ... section 17C of the 1978 Act (in the case of personal dental services) , or the corresponding provisions of the law in force in Northern Ireland or the Isle of Man, or

• (iii) local pharmaceutical services provided under a pilot scheme established under section 134 of the National Health Service Act 2006, or section 92 of the National Health Service (Wales) Act 2006, or an LPS scheme established under Schedule 12 to the National Health Service Act 2006, or Schedule 7 to the National Health Service (Wales) Act 2006, or under any corresponding provision of the law in force in the Isle of Man

and,

• (b) specified for the purposes of this subsection in regulations made by the Secretary of State.

Rights of third parties in respect of Crown use

57

• (1) In relation to—

• (a) any use made for the services of the Crown of an invention by a government department, or a person authorised by a government department, by virtue of section 55 above, or

• (b) anything done for the services of the Crown to the order of a government department by the proprietor of a patent in respect of a patented invention or by the proprietor of an application in respect of an invention for which an application for a patent has been filed and is still pending,

the provisions of any licence, assignment, assignation or agreement to which this subsection applies shall be of no effect so far as those provisions restrict or regulate the working of the invention, or the use of any model, document or information relating to it, or provide for the making of payments in respect of, or calculated by reference to, such working or use; and the reproduction or publication of any model or document in connection with the said working or use shall not be deemed to be an infringement of any copyright or design right subsisting in the model or document.

• (2) Subsection (1) above applies to a licence, assignment, assignation or agreement which is made, whether before or after the appointed day, between (on the one hand) any person who is a proprietor of or an applicant for the patent, or anyone who derives title from any such person or from whom such person derives title, and (on the other hand) any person whatever other than a government department.

• (3) Where an exclusive licence granted otherwise than for royalties or other benefits determined by reference to the working of the invention is in force under the patent or application concerned, then—

• (a) in relation to anything done in respect of the invention which, but for the provisions of this section and section 55 above, would constitute an infringement of the rights of the licensee, subsection (4) of that section shall have effect as if for the reference to the proprietor of the patent there were substituted a reference to the licensee; and

• (b) in relation to anything done in respect of the invention by the licensee by virtue of an authority given under that section, that section shall have effect as if the said subsection (4) were omitted.

• (4) Subject to the provisions of subsection (3) above, where the patent, or the right to the grant of the patent, has been assigned to the proprietor of the patent or application in consideration of royalties or other benefits determined by reference to the working of the invention, then—

• (a) in relation to any use of the invention by virtue of section 55 above, subsection (4) of that section shall have effect as if the reference to the proprietor of the patent included a reference to the assignor, and any sum payable by virtue of that subsection shall be divided between the proprietor of the patent or application and the assignor in such proportion as may be agreed on by them or as may in default of agreement be determined by the court on a reference under section 58 below; and

• (b) in relation to any act done in respect of the invention for the services of the Crown by the proprietor of the patent or application to the order of a government department, section 55(4) above shall have effect as if that act were use made by virtue of an authority given under that section.

• (5) Where section 55(4) above applies to any use of an invention and a person holds an exclusive licence under the patent or application concerned (other than such a licence as is mentioned in subsection (3) above) authorising him to work the invention, then subsections (7) and (8) below shall apply.

• (6) In those subsections “the section 55(4)” payment means such payment (if any) as the proprietor of the patent or application and the department agree under section 55 above, or the court determines under section 58 below, should be made by the department to the proprietor in respect of the use of the invention.

• (7) The licensee shall be entitled to recover from the proprietor of the patent or application such part (if any) of the section 55(4) payment as may be agreed on by them or as may in default of agreement be determined by the court under section 58 below to be just having regard to any expenditure incurred by the licensee—

• (a) in developing the invention, or

• (b) in making payments to the proprietor in consideration of the licence, other than royalties or other payments determined by reference to the use of the invention.

• (8) Any agreement by the proprietor of the patent or application and the department under section 55(4) above as to the amount of the section 55(4) payment shall be of no effect unless the licensee consents to the agreement; and any determination by the court under section 55(4) above as to the amount of that payment shall be of no effect unless the licensee has been informed of the reference to the court and is given an opportunity to be heard.

• (9) Where any models, documents or information relating to an invention are used in connection with any use of the invention which falls within subsection (1)(a) above, or with anything done in respect of the invention which falls within subsection (1)(b) above, subsection (4) of section 55 above shall (whether or not it applies to any such use of the invention) apply to the use of the models, documents or information as if for the reference in it to the proprietor of the patent there were substituted a reference to the person entitled to the benefit of any provision of an agreement which is rendered inoperative by this section in relation to that use; and in section 58 below the references to terms for the use of an invention shall be construed accordingly.

• (10) Nothing in this section shall be construed as authorising the disclosure to a government department or any other person of any model, document or information to the use of which this section applies in contravention of any such licence, assignment, assignation or agreement as is mentioned in this section.

References of disputes as to Crown use

58

• (1) Any dispute as to—

• (a) the exercise by a government department, or a person authorised by a government department, of the powers conferred by section 55 above,

• (b) terms for the use of an invention for the services of the Crown under that section,

• (c) the right of any person to receive any part of a payment made in pursuance of subsection (4) of that section, or

• (d) the right of any person to receive a payment under section 57A,

may be referred to the court by either party to the dispute after a patent has been granted for the invention.

• (2) If in such proceedings any question arises whether an invention has been recorded or tried as mentioned in section 55 above, and the disclosure of any document recording the invention, or of any evidence of the trial thereof, would in the opinion of the department be prejudicial to the public interest, the disclosure may be made confidentially to the other party's legal representative or to an independent expert mutually agreed upon.

• (3) In determining under this section any dispute between a government department and any person as to the terms for the use of an invention for the services of the Crown, the court shall have regard—

• (a) to any benefit or compensation which that person or any person from whom he derives title may have received or may be entitled to receive directly or indirectly from any government department in respect of the invention in question;

• (b) to whether that person or any person from whom he derives title has in the court’s opinion without reasonable cause failed to comply with a request of the department to use the invention for the services of the Crown on reasonable terms.

• (4) In determining whether or not to grant any relief under subsection (1)(a), (b) or (c) above and the nature and extent of the relief granted the court shall, subject to the following provisions of this section, apply the principles applied by the court immediately before the appointed day to the granting of relief under section 48 of the 1949 Act.

• (5) On a reference under this section the court may refuse to grant relief by way of compensation in respect of the use of an invention for the services of the Crown during any further period specified under section 25(4) above, but before the payment of the renewal fee and any additional fee prescribed for the purposes of that section.

• (6) Where an amendment of the specification of a patent has been allowed under any of the provisions of this Act, or, in the case of a European patent (UK), has been allowed under any of the provisions in the Agreement on a Unified Patent Court, the court shall not grant relief by way of compensation under this section in respect of any such use before the decision to allow the amendment unless the court is satisfied that

• (a) the specification of the patent as published was framed in good faith and with reasonable skill and knowledge and.

• (b) the relief is sought in good faith

• (7) If the validity of a patent is put in issue in proceedings under this section and it is found that the patent is only partially valid, the court may, subject to subsection (8) below, grant relief to the proprietor of the patent in respect of that part of the patent which is found to be valid and to have been used for the services of the Crown.

• (8) Where in any such proceedings it is found that a patent is only partially valid, the court shall not grant relief by way of compensation, costs or expenses except where the proprietor of the patent proves that

• (a) the specification of the patent was framed in good faith and with reasonable skill and knowledge, and

• (b) the relief is sought in good faith,

and in that event the court may grant relief in respect of that part of the patent which is valid and has been so used, subject to the discretion of the court as to costs and expenses and as to the date from which compensation should be awarded.

• (9) As a condition of any such relief the court may direct that the specification of the patent shall be amended to its satisfaction upon an application made for that purpose under section 75 below, and an application may be so made accordingly, whether or not all other issues in the proceedings have been determined.

• (9A) The court may also grant such relief in the case of a European patent (UK) on condition that the claims of the patent are limited to its satisfaction by the European Patent Office at the request of the proprietor.

• (10) In considering the amount of any compensation for the use of an invention for the services of the Crown after publication of an application for a patent for the invention and before such a patent is granted, the court shall consider whether or not it would have been reasonable to expect, from a consideration of the application as published under section 16 above, that a patent would be granted conferring on the proprietor of the patent protection for an act of the same description as that found to constitute that use, and if the court finds that it would not have been reasonable, it shall reduce the compensation to such amount as it thinks just.

• (11) Where by virtue of a transaction, instrument or event to which section 33 above applies a person becomes the proprietor or one of the proprietors or an exclusive licensee of a patent (the new proprietor or licensee) and a government department or a person authorised by a government department subsequently makes use under section 55 above of the patented invention, the new proprietor or licensee shall not be entitled to any compensation under section 55(4) above (as it stands or as modified by section 57(3) above) , or to any compensation under section 57A above, in respect of a subsequent use of the invention before the transaction, instrument or event is registered unless—

• (a) the transaction, instrument or event is registered within the period of six months beginning with its date; or

• (b) the court is satisfied that it was not practicable to register the transaction, instrument or event before the end of that period and that it was registered as soon as practicable thereafter.

• (12) In any proceedings under this section the court may at any time order the whole proceedings or any question or issue of fact arising in them to be referred, on such terms as the court may direct, to a Circuit judge discharging the functions of an official referee or an arbitrator in England and Wales or Northern Ireland, or to an arbiter in Scotland; and references to the court in the foregoing provisions of this section shall be construed accordingly.

• (13) One of two or more joint proprietors of a patent or application for a patent may without the concurrence of the others refer a dispute to the court under this section, but shall not do so unless the others are made parties to the proceedings; but any of the others made a defendant or defender shall not be liable for any costs or expenses unless he enters an appearance and takes part in the proceedings.

Special provisions as to Crown use during emergency

59

• (1) During any period of emergency within the meaning of this section the powers exercisable in relation to an invention by a government department or a person authorised by a government department under section 55 above shall include power to use the invention for any purpose which appears to the department necessary or expedient—

• (a) for the efficient prosecution of any war in which Her Majesty may be engaged;

• (b) for the maintenance of supplies and services essential to the life of the community;

• (c) for securing a sufficiency of supplies and services essential to the well-being of the community;

• (d) for promoting the productivity of industry, commerce and agriculture;

• (e) for fostering and directing exports and reducing imports, or imports of any classes, from all or any countries and for redressing the balance of trade;

• (f) generally for ensuring that the whole resources of the community are available for use, and are used, in a manner best calculated to serve the interests of the community; or

• (g) for assisting the relief of suffering and the restoration and distribution of essential supplies and services in any country or territory outside the United Kingdom which is in grave distress as the result of war;

and any reference in this Act to the services of the Crown shall, as respects any period of emergency, include a reference to those purposes.