Industrial and Commercial Property (Protection) Act, 1927

Provisions as to patents indorsed “licences of right.”

40.—(1) At any time after the sealing of a patent the controller shall, if the patentee so requests, cause the patent to be indorsed with the words “licences of right,” and a corresponding entry to be made in the register, and thereupon—

(a) any person shall at any time thereafter be entitled as of right to a licence under the patent upon such terms as, in default of agreement, may be settled by the controller on the application of either the patentee or the applicant:

Provided that any licence the terms of which are settled by agreement shall be deemed, unless otherwise expressly provided, to include the terms and conditions specified in paragraphs (c) and (d) of this sub-section as if they had been imposed by the controller thereunder in like manner as if the terms had been settled by the controller;

(b) in settling the terms of any such licence the controller shall be guided by the following considerations—

(i) he shall, on the one hand, endeavour to secure the widest possible user of the invention in Saorstát Eireann consistent with the patentee deriving a reasonable advantage from his patent rights,

(ii) he shall, on the other hand, endeavour to secure to the patentee the maximum advantage consistent with the invention being worked by the licensee at a reasonable profit in Saorstát Eireann,

(iii) he shall also endeavour to secure equality of advantage among the several licensees, and for this purpose may, on due cause being shown, reduce the royalties or other payments accruing to the patentee under any licence previously granted:

Provided that, in considering the question of equality of advantage, the controller shall take into account any work done or outlay incurred by any previous licensee with a view to testing the commercial value of the invention or to securing the working thereof on a commercial scale in Saorstát Eireann;

(c) any such licence the terms of which are settled by the controller may be so framed as to preclude the licensee from importing into Saorstát Eireann any goods the importation of which, if made by persons other than the patentee or those claiming under him, would be an infringement of the patent, and in such a case the patentee and all licensees under the patent shall be deemed to have mutually covenanted against such importation;

(d) every such licensee shall be entitled to call upon a patentee to take proceedings to prevent the infringement of the patent, and if the patentee refuses, or neglects to do so within two months after being so called upon, the licensee may institute proceedings for the infringement in his own name as though he were patentee, making the patentee a defendant. A patentee so added as defendant shall not be liable for any costs unless he enters an appearance and takes part in the proceedings. Service on him may be effected by leaving the writ at his address for service given on the register;

(e) if in any action for infringement of a patent so indorsed the infringing defendant is ready and willing to take a licence upon terms to be settled by the controller, no injunction against him shall be awarded, and the amount recoverable against him by way of damages (if any) shall not exceed double the amount which would have been recoverable against him as licensee if the licence had been dated prior to the earliest infringement:

Provided that this paragraph shall not apply wherethe infringement consists of the importation of infringing goods;

(f) the renewal fees payable by the patentee of a patent so indorsed shall, as from the date of the indorsement, be one moiety only of the fees which would otherwise have been payable.

(2) The controller shall, before acting on any request to indorse a patent made by the patentee under this section, advertise such request in the Journal, and shall satisfy himself that the patentee is not precluded by contract from making such request, and for that purpose shall require from the patentee such evidence, by statutory declaration or otherwise, as he may deem necessary:

Provided that a patentee shall not be deemed to be so precluded by reason only of his having granted a licence under the patent where the licence does not limit his right to grant other licenees.

(3) Any person, alleging that a request under this section has been made contrary to some contract in which he is interested, may apply to the controller within the prescribed time and in the prescribed manner, and the controller, if satisfied of the truth of such allegation, shall refuse to indorse the patent pursuant to the request, or shall cause the indorsement, if already made, to be cancelled.

Any order under this sub-section shall be subject to appeal to the court.

(4) All indorsements of patents under this section shall be entered on the register of patents and shall be published in the Journal and in such other manner as the controller may deem desirable for the purpose of bringing the invention to the notice of manufacturers.

(5) If at any time it appears that in the case of a patent so indorsed there is no existing licence the controller may, if he thinks fit, on the application of the patentee and on payment by him of the unpaid moiety of all renewal fees which have become due since the indorsement, after due notice cancel the indorsement, and in that case the patentee's rights and liabilities shall be the same as if no such indorsement had been made.