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MERCANTILE LAW
INTELLECTUAL
PROPERTY LAW

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I. Intellectual Property
Rights in General
A. STATE POLICIES
(1) To protect and secure the exclusive rights
of scientists, inventors, artists and other
gifted citizens to their intellectual property
and creations, particularly when beneficial
to the people, for such periods as provided
in this Act.
(2) To promote the diffusion of knowledge and
information for the promotion of national
development and progress and the
common good.
(3) To streamline administrative procedures of
registering patents, trademarks and
copyright, to liberalize the registration on
the transfer of technology, and to enhance
the enforcement of intellectual property
rights in the Philippines. [Sec. 2, RA 8293]
B. INTERNATIONAL CONVENTIONS
GOVERNING INTELLECTUAL
PROPERTY RIGHTS
(1) Berne Convention for the Protection of
Literary and Artistic Works as revised by
the Brussels Act (August 1, 1951)
(2) Paris Convention for the Protection of
Industrial Property Rights (September 27,
1965)
(3) International Convention for the Protection
of Performers, Producers of Phonograms
and Broadcasting Organizations (Rome
Convention, September 25, 2984)
(4) Convention Establishing the World
Intellectual Property Organization (July 14,
1980)
(5) Budapest Treaty on the International
Recognition of the Deposit of
Microorganisms for the Purposes of Patent
Procedure (October 21, 1981)
(6) Agreement on Trade Related Aspects of
Intellectual Property Including Trade in
Counterfeit Goods of General Agreement
on Tariffs and Trade.
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(7) Patent Cooperation Treaty (August 17,
2001)
(8) Madrid Protocol
C. INTELLECTUAL PROPERTY
RIGHTS
C.1. DEFINITION
Those property rights which result from the
physical manifestation of original thought.
[Ballantines Law Dictionary]
Note: There are no property rights protected by
law in mere ideas or mental conceptions.
When creations of mind are put in tangible
form, there is appropriate subject of property
that is protected by law. [63A Am Jur 3rd
Property, Section 5]
C.2. INTELLECTUAL PROPERTY RIGHTS
UNDER THE INTELLECTUAL PROPERTY
CODE
(1) Copyright;
(2) Related Rights of copyright;
(3) Trademarks and Service Marks;
(4) Geographic Indications;
(5) Industrial Designs;
(6) Patents;
(7) Layout-Designs (Topographies) of
Integrated Circuits; [Sec. 4, RA 8293]
(8) Protection of Undisclosed Information
(TRIPS Agreement).
D. DIFFERENCES BETWEEN
COPYRIGHTS, TRADEMARKS AND
PATENT
D.1. PATENTABLE INVENTIONS
Refer to any technical solution of a problem in
any field of human activity, which is new,
involves an inventive step and is industrially
applicable. It may be, or refer to, any product,
process, or an improvement of any of the
foregoing. [Sec. 21, RA 8293] It is vested from
the issuance of letters of patent.
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D.2. TRADEMARK
Any visible sign capable of distinguishing the
goods (trademark) or services (service mark) of
an enterprise and shall include a stamped or
marked container of goods. [Kho v. CA, et al.
(2002)] It is vested from registration.
D.3. TRADE NAME
The name or designation identifying or
distinguishing an enterprise [Sec. 121.3, RA
8293]
D.4. COPYRIGHT
Right granted by statute to the author or
originator of literary, scholarly, scientific, or
artistic productions, including computer
programs. A copyright gives him the legal right
to determine how the work is used and to
obtain economic benefits from the work. For
example, the owner of a copyright for a book or
a piece of software has the exclusive rights to
use, copy, distribute, and sell copies of the
work, including later editions or versions of the
work. If another person improperly uses
material covered by a copyright, the copyright
owner can obtain legal relief. [Rule 2, Copyright
Safeguards and Regulations]
Copyright or economic rights shall consist of
the exclusive right to carry out, authorize or
prevent the following acts:
(1) Reproduction of the work or substantial
portion of the work
(2) Dramatization, translation or adaptation,
abridgment, arrangement or other
transformation of the work.
(3) The first public distribution of the original
and each copy of the work by sale or other
forms of transfer of ownership.
(4) Rental of the original or a copy of an
audiovisual or cinematographic work, a
work embodied in a sound recording, a
computer program, a compilation of data
and other materials or a musical work in
graphic form, irrespective of the ownership
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of the original or the copy which is the
subject of the rental.
(5) Public Display of the original or a copy of
the work.
(6) Public Performance of the Work;
(7) Other Communication to the public of the
work. [Sec. 177, IPC]
Copyright is confined to literary and artistic
works which are original intellectual creations
in the literary and artistic domain protected
from the moment of their creation. [Kho v. CA,
et al. (2002)] It is vested from the moment of
creation.
D.5. OTHER FORMS OF INTELLECTUAL
PROPERTY
i. Geographic Indication
One which identifies a good as originating in
the territory of a TRIPS member, or a region or
locality in that territory where a given quality,
reputation or other characteristic of a good is
essentially attributable to its geographical
origin [Art. 22, TRIPS Agreement]
ii. Industrial Design
Any composition of lines or colors or any three-
dimensional form, whether or not associated
with lines or colors: Provided, that such
composition or form gives a special
appearance to and can serve as pattern for an
industrial product or handicraft. (Sec. 112.1, RA
8293)
iii. Layout Design (Topography) of an Integrated
Circuit
Layout Design (Topography) The three-
dimensional disposition, however expressed, of
the elements, at least one of which is an active
element, and of some or all the
interconnections of an integrated circuit, or
such a three-dimensional disposition prepared
for an integrated circuit intended for
manufacture. (Sec. 112.3, RA 8293)
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iv. Integrated Circuit a product, in its final
form, or an intermediate form, in which the
elements, at least one of which is an active
element and some or all of the
interconnections are integrally formed and/or
on a piece of material, and which is intended to
perform an electronic function. (Sec. 112.2, RA
8293)
v. Undisclosed Information
Information which:
(1) Is a secret in a sense that it is not, as a
body or in the precise configuration and
assembly of components, generally known
among or readily accessible to persons
within the circles that normally deal with
the kind of information in question;
(2) Has a commercial value because it is
secret; and
(3) Has been subject to reasonable steps
under the circumstances, by the person
lawfully in control of the information, to
keep it secret [Art. 39, TRIPS]
E. TECHNOLOGY TRANSFER
ARRANGEMENTS
Refers to contracts or agreements involving:
(1) the transfer of systematic knowledge for
the manufacture of a product;
(2) the application of a process, or rendering
of a service including management
contracts;
(3) The transfer, assignment or licensing of all
forms of intellectual property rights,
including licensing of computer software
except computer software developed for
mass market. [Sec. 4.2, RA 8293]
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II. Patents
A. PATENTABLE INVENTIONS
A patentable invention is any technical
solution of a problem in any field of human
activity which is new, involves an inventive step
and is industrially applicable shall be
Patentable. It may be, or may relate to, a
product, or process, or an improvement of any
of the foregoing. [Sec. 21, RA 8293]
A.1. INVENTION PATENT
i. Standards
Novelty An invention shall not be considered
new if it forms part of a prior art. [Sec. 23, RA
8293]
Prior art shall consist of:
(1) Everything which has been made available
to the public anywhere in the world, before
the filing date or the priority date of the
application claiming the invention; [Sec.
24.1, RA 8293]
(2) The whole contents of an application for a
patent, utility model, or industrial design
registration, published in accordance with
this Act, filed or effective in the Philippines,
with a filing or priority date that is earlier
than the filing or priority date of the
application: Provided, That the application
which has validly claimed the filing date of
an earlier application under Section 31 of
this Act, shall be prior art with effect as of
the filing date of such earlier application:
Provided further, That the applicant or the
inventor identified in both applications are
not one and the same. [Sec. 24.2, RA
8293]
Non-Prejudicial Disclosures This is an
exception to the General Rule on Prior Art
under Sec. 24. It provides that the disclosure of
the information contained in the application
during the 12 months preceding the filing date
or the priority date of the application shall not
prejudice the applicant on the ground of lack
of novelty if such disclosure was made by:
(1) The inventor
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(2) A patent office and the information
contained (1) in another application filed by
the inventor and should not have been
disclosed by the office, or (2) in an
application filed without the knowledge or
consent of the inventor by a third party
which obtained the information directly or
indirectly from the inventor
(3) A third party which obtained the
information directly or indirectly from the
inventor [Sec. 25, RA 8293]
(a) Inventive Step An invention involves
an inventive step if, having regard to
prior art, it is not obvious to a person
skilled in the art at the time of the
filing date or priority date of the
application claiming the invention. [Sec.
26.1, RA 8293, as amended by RA
9502]
Cheaper Medicines Act In case of
drugs and medicines, there is no
inventive step if the invention results
from the mere discovery of a new form
or new property of a known substance
which does not result in enhancement
of the known efficacy of that substance,
or the mere discovery of any new
property or new use of a known
substance or the mere use of a known
process unless such known process
results in a new product that employs
at least one reactant. [Sec. 26.2, RA
8293 as amended by RA 9502]
(b) Industrial Applicability An invention
that can be produced and used in any
industry shall be industrially applicable.
[Sec. 27, RA 8293]
ii. Utility
It is any technical solution of a problem in any
field of human activity which is new and
industrially applicable. Unlike an invention
patent, a utility model need not be inventive.
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The law merely requires that it be novel and
industrially applicable. [Sec. 109.1, RA 8293]
A utility model registration shall expire,
without any possibility of renewal, at the end of
the seventh year after the date of the filing of
the application. [Sec. 109.3, RA 8293]
Statutory Classes of Utility Models
A Utility Model may be, or may relate to:
(1) A useful machine;
(2) An implement or tool;
(3) A product or composition;
(4) A method or process; or
(5) An improvement of any of the foregoing.
[Rule 201, Rules and Regulations on Utility
Models and Industrial Designs as
amended]
Grounds for Cancellation of Utility Models
(1) That the claimed invention does not qualify
for registration as a utility model and does
not meet the requirements of registrability;
(2) That the description and the claims do not
comply with the prescribed requirements;
(3) That any drawing which is necessary for
the understanding of the invention has not
been furnished;
(4) That the owner of the utility model
registration is not the inventor or his
successor in title [Sec 109.4, RA 8293]
Industrial Design
An industrial design is any composition of lines
or colors or any three-dimensional form,
whether or not associated with lines or colors:
Provided that such composition or form gives a
special appearance to and can serve as pattern
for an industrial product or handicraft. [Sec.
112.1, RA 8293 as amended by RA 9150]
Lay-out Designs (Topographies) of Integrated
Circuits
Integrated Circuitmeans a product, in its final
form, or an intermediate form, in which the
elements, at least one of which is an active
element and some or all of the
interconnections are integrally formed in
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and/or on a piece of material, and which is
intended to perform an electronic function.
[Sec. 112.2, RA 8293 as amended by RA 9150]
Layout-Design is synonymous with
'Topography' and means the three-
dimensional disposition, however expressed, of
the elements, at least one of which is an active
element, and of some or all of the
interconnections of an integrated circuit, or
such a three-dimensional disposition prepared
for an integrated circuit intended for
manufacture. [Sec. 112.3, RA 8293 as amended
by RA 9150]
B. NON-PATENTABLE INVENTIONS
The following shall be excluded from patent
protection:
(1) Discoveries, scientific theories and
mathematical methods, and in the case of
drugs and medicines, the mere discovery of
a new form or new property of a known
substance which does not result in the
enhancement of the known efficacy of that
substance, or the mere discovery of any
new property or new use for a known
substance, or the mere use of a known
process unless such known process results
in a new product that employs at least one
new reactant.
Salts, esters, ethers, polymorphs, metabolites,
pure form, particle size, isomers, mixtures of
isomers, complexes, combinations, and other
derivatives of a known substance shall be
considered to be the same substance, unless
they differ significantly in properties with
regard to efficacy; [Sec. 22.1, RA 8293 as
amended by RA 9502]
(2) Schemes, rules and methods of performing
mental acts, playing games or doing
business, and programs for computers;
[Sec. 22.2, RA 8293]
(3) Methods for treatment of the human or
animal body by surgery or therapy and
diagnostic methods practiced on the
human or animal body. This provision shall
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not apply to products and composition for
use in any of these methods; [Sec. 22.3, RA
8293]
(4) Plant varieties or animal breeds or
essentially biological process for the
production of plants or animals. This
provision shall not apply to micro-
organisms and non-biological and
microbiological processes; [Sec. 22.4, RA
8293]
(5) Aesthetic creations; [Sec. 22.5, RA 8293]
(6) Anything which is contrary to public order
or morality. [Sec. 22.6, RA 8293]
Cheaper Medicines Act: In addition to
discoveries, scientific theories and
mathematical methods, the IP Code now
includes, in case of drugs and medicines:
(1) The mere discovery of a new form or new
property of a known substance which does
not result in the enhancement of the
known efficacy of that substance
(2) the mere discovery of any new property or
new use of a known substance
(3) the mere use of a known process unless
such known process results in a new
product that employs at least one reactant
(Sec. 26.2, RA 8293 as amended by RA
9502)
C. OWNERSHIP OF A PATENT
C.1. RIGHT TO A PATENT
General Rule: The right to patent belongs to
the inventor, his heirs, or assigns. When two (2)
or more persons have jointly made an
invention, the right to a patent shall belong to
them jointly. (Sec.28, RA 8293)
Exception: Inventions created pursuant to a
commission (Work for Hire Doctrine)
(1) The employer has the right to the patent if
the invention is the result of the
performance of the employees regularly
assigned duties [Sec. 30.2, RA 8293]
(2) In case of inventions created pursuant to a
commission, the person who commissions
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the work shall own the patent [Sec. 30.1,
RA 8293]
C.2. FIRST-TO-FILE RULE
If two (2) or more persons have made the
invention separately and independently of
each other, the right to the patent shall belong
to the person who filed an application for such
invention, or where two or more applications
are filed for the same invention, to the
applicant who has the earliest filing date or,
the earliest priority date. [Sec. 29, RA 8293]
C.3. INVENTIONS CREATED PURSUANT
TO A COMMISSION
D. GROUNDS FOR CANCELLATION
OF A PATENT
Any interested person may, upon payment of
the required fee, petition to cancel the patent
or any claim thereof, or parts of the claim, on
any of the following grounds:
(1) That what is claimed as the invention is not
new or patentable;
(2) That the patent does not disclose the
invention in a manner sufficiently clear and
complete for it to be carried out by any
person skilled in the art; or
(3) That the patent is contrary to public order
or morality. [Sec. 61.1, RA 8293]

Commission: Person who commissions the Where the grounds for cancellation relate to
work shall own the patent, unless otherwise some of the claims or parts of the claim,
provided in the contract [Sec. 30.1, RA 8293) cancellation may be effected to such extent
only. [Sec. 61.2, RA 8293]
Employment Contract: Patent belongs to the
D.1. REQUIREMENT OF THE PETITION
employee if the inventive activity is not a part
The petition for cancellation shall be in writing,
of his regular duties even if the employee uses
verified by the petitioner or by any person in his
the time, facilities and materials of the
behalf who knows the facts, specify the
employer. [Sec. 30.2 (a), RA 8293]
grounds upon which it is based, include a
statement of the facts to be relied upon, and
Patent belongs to the employer if the invention
filed with the Office. Copies of printed
is the result of the performance of his
publications or of patents of other countries,
regularly-assigned duties, unless there is an
and other supporting documents mentioned in
agreement, express or implied, to the contrary.
the petition shall be attached thereto, together
[Sec. 30.2 (b), RA 8293]
with the translation thereof in English, if not in
C.4. RIGHT OF PRIORITY English language. [Sec. 62, RA 8293]
An application for patent filed by any person
D.2. NOTICE OF HEARING
who has previously applied for the same
Upon filing of a petition for cancellation, the
invention in another country which by treaty,
Director of Legal Affairs shall forthwith serve
convention, or law affords similar privileges to
notice of the filing thereof upon the patentee
Filipino citizens, shall be considered as filed as
and all persons having grants or licenses, or
of the date of filing the foreign application:
any other right, title or interest in and to the
Provided, That: (a) the local application
patent and the invention covered thereby, as
expressly claims priority; (b) it is filed within
appears of record in the Office, and of notice of
twelve (12) months from the date the earliest
the date of hearing thereon on such persons
foreign application was filed; and (c) a certified
and the petitioner. Notice of the filing of the
copy of the foreign application together with
petition shall be published in the IPO Gazette.
an English translation is filed within six (6)
[Sec. 63, RA 8293]
months from the date of filing in the
Philippines. [Sec. 31, RA 8293]

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D.3. EFFECT OF CANCELLATION OF
PATENT OR CLAIM
The rights conferred by the patent or any
specified claim or claims cancelled shall
terminate. Notice of the cancellation shall be
published in the IPO Gazette. Unless
restrained by the Director General, the decision
or order to cancel by Director of Legal Affairs
shall be immediately executory even pending
appeal. [Sec. 66, RA 8293]
E. REMEDY OF THE TRUE AND
ACTUAL INVENTOR
If a person, who was deprived of the patent
without his consent or through fraud is
declared by final court order or decision to be
the true and actual inventor, the court shall
order for his substitution as patentee, or at the
option of the true inventor, cancel the patent,
and award actual and other damages in his
favor if warranted by the circumstances. [Sec.
68, RA 8293]
E.1. TIME TO FILE ACTION IN COURT
The action shall be filed within one (1) year
from the date of publication made in
accordance with Sections 44 and 51,
respectively. (Sec. 70, RA 8293)
E.2. REMEDY OF PERSONS NOT HAVING
THE RIGHT TO A PATENT
If a person other than the applicant, is
declared by final court order or decision as
having the right to the patent, such person
may, within three (3) months after the decision
has become final:
(1) Prosecute the application as his own
application in place of the applicant;
(2) File a new patent application in respect of
the same invention;
(3) Request that the application be refused; or
(4) Seek cancellation of the patent, if one has
already been issued. [Sec. 67, RA 8293]
F. RIGHTS CONFERRED BY A PATENT
A patent shall confer on its owner the following
exclusive rights:
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(1) Where the subject matter of a patent is a
product, to restrain, prohibit and prevent
any unauthorized person or entity from
making, using, offering for sale, selling or
importing that product. [Sec. 71.1(a), RA
8293]
(2) Where the subject matter of a patent is a
process, to restrain, prevent or prohibit any
unauthorized person or entity from using
the process, and from manufacturing,
dealing in, using, selling or offering for sale,
or importing any product obtained directly
or indirectly from such process. [Sec. 71.1(b),
RA 8293]
(3) Patent owners shall also have the right to
assign, or transfer by succession the patent,
and to conclude licensing contracts for the
same. [Sec. 71.2, RA 8293]
Pearl Dean, Inc. v. Shoemart, Inc. (2003)To be
able to effectively and legally preclude others
from copying and profiting from the invention,
a patent is a primordial requirement. No
patent, no protection. The ultimate goal of a
patent system is to bring new designs and
technologies into the public domain through
disclosure Ideas, once disclosed to the public
without the protection of a valid patent, are
subject to appropriation without significant
restraint.
G. LIMITATIONS OF PATENT RIGHTS
The owner of a patent has no right to prevent
third parties from performing, without his
authorization, the acts referred to in Section 71
hereof in the following circumstances:
(1) Using a patented product which has been
put on the market in the Philippines by the
owner of the product, or with his express
consent, insofar as such use is performed
after that product has been so put on the
said market: Provided, That, with regard to
drugs and medicines, the limitation on
patent rights shall apply after a drug or
medicine has been introduced in the
Philippines or anywhere else in the world
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by the patent owner, or by any party
authorized to use the invention: Provided,
further, That the right to import the drugs
and medicines contemplated in this
section shall be available to any
government agency or any private third
party; [Sec. 72.1, RA 8293 as amended by
RA 9502]
(2) Where the act is done privately and on a
non-commercial scale or for a non-
commercial purpose: Provided, That it
does not significantly prejudice the
economic interests of the owner of the
patent; [Sec. 72.2, RA 8293 as amended by
RA 9502]
(3) Where the act consists of making or using
exclusively for experimental use of the
invention for scientific purposes or
educational purposes and such other
activities directly related to such scientific
or educational experimental use; [Sec. 72.3,
RA 8293 as amended by RA 9502]
(4) In the case of drugs and medicines, where
the act includes testing, using, making or
selling the invention including any data
related thereto, solely for purposes
reasonably related to the development and
submission of information and issuance of
approvals by government regulatory
agencies required under any law of the
Philippines or of another country that
regulates the manufacture, construction,
use or sale of any product: Provided, That,
in order to protect the data submitted by
the original patent holder from unfair
commercial use provided in Article 39.3 of
the Agreement on Trade-Related Aspects
of Intellectual Property Rights (TRIPS
Agreement), the Intellectual Property Office,
in consultation with the appropriate
government agencies, shall issue the
appropriate rules and regulations
necessary therein not later than one
hundred twenty (120) days after the
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enactment of this law; (Sec. 72.4, RA 8293
as amended by RA 9502)
(5) Where the act consists of the preparation
for individual cases, in a pharmacy or by a
medical professional, of a medicine in
accordance with a medical shall apply
after a drug or medicine has been
introduced in the Philippines or anywhere
else in the world by the patent owner, or by
any party authorized to use the invention:
Provided, further, That the right to import
the drugs and medicines contemplated in
this section shall be available to any
government agency or any private third
party; (Sec. 72.5, RA 8293 as amended by
RA 9502)
There shall be no infringement of trademarks
or tradenames of imported or sold drugs and
medicines allowed as well as imported or sold
off-patent drugs and medicines: Provided, That
said drugs and medicines bear the registered
marks that have not been tampered,
unlawfully modified, or infringed. (Sec.159.4
RA 8293 as amended by RA 9502)
G.1. PRIOR USER
Notwithstanding Section 72 hereof, any prior
user, who, in good faith was using the
invention or has undertaken serious
preparations to use the invention in his
enterprise or business, before the filing date or
priority date of the application on which a
patent is granted, shall have the right to
continue the use thereof as envisaged in such
preparations within the territory where the
patent produces its effect. [Sec. 73.1, RA 8293]
The right of the prior user may only be
transferred or assigned together with his
enterprise or business, or with that part of his
enterprise or business in which the use or
preparations for use have been made. [Sec.
73.2, RA 8293]
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G.2. USE BY THE GOVERNMENT
A Government agency or third person
authorized by the Government may exploit the
invention even without agreement of the
patent owner where:
(1) The public interest, in particular, national
security, nutrition, health or the
development of other sectors, as
determined by the appropriate agency of
the government, so requires; [Sec. 74.1(a),
RA 8293]
(2) A judicial or administrative body has
determined that the manner of
exploitation, by the owner of the patent or
his licensee, is anti-competitive. [Sec.
74.1(b), RA 8293]
The use by the Government, or third person
authorized by the Government shall be subject,
mutatis mutandis, to the conditions set forth in
Sections 95 to 97 and 100 to 102 on compulsory
licensing. [Sec. 74.2, RA 8293]
All cases arising from the implementation of
this provision shall be cognizable by courts
with appropriate jurisdiction provided by law.
No court except the Supreme Court of the
Philippines, shall issue any temporary
restraining order or preliminary injunction or
such other provisional remedies that will
prevent its immediate execution. [Sec. 74.3, RA
8293 as amended by RA 9502]
H. PATENT INFRINGEMENT
It is the making, using, offering for sale, selling,
or importing a patented product or a product
obtained directly or indirectly from a patented
process, or the use of a patented process
without the authorization of the patentee. [Sec
76.1, RA 8293 as amended by RA 9502]
H.1. CONTRIBUTORY INFRINGER
One who actively induces the infringement of a
patent or provides the infringer with a
component of a patented product or of a
product produced because of a patented
process knowing it to be especially adopted for
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infringing and not suitable for substantial non-
infringing. He is jointly and severally liable with
the infringer. [Sec. 76.6, RA 8293]
H.2. DOCTRINE OF PATENT
EXHAUSTION
It espouses that the patentee who has already
sold his invention and has received all the
royalty and consideration for the same will be
deemed to have released the invention from
his monopoly. The invention thus becomes
open to use of the purchaser without further
restriction. [Adams v. Burke,in Notes on
Selected Commercial Laws, Catindig 2003 ed.]
H.3. TESTS IN PATENT INFRINGEMENT
i. Literal infringement
In using literal infringement as a test, resort
must be had in the first instance to the words
of the claim. To determine whether the
particular item falls within the literal meaning
of the patent claims, the court must juxtapose
the claims of the patent and the accused
product within the overall context of the claims
and specifications, to determine whether there
is exact identity of all material elements.
[Godinez v. CA (1993)]
ii. Doctrine of equivalents
Under the doctrine of equivalents, an
infringement also occurs when a device
appropriates a prior invention by incorporating
its innovative concept and, albeit with some
modification and change, performs
substantially the same function in
substantially the same way to achieve
substantially the same result. [Godinez v. CA
(1993)]
In order to infringe a patent, a machine or
device must perform the same function, or
accomplish the same result by identical or
substantially identical means and the principle
or mode of operation must be substantially the
same. [Del Rosario v. CA (1996)]
UP LAW BOC INTELLECTUAL PROPERTY CODE
The doctrine of equivalents provides that an
infringement also takes place when a device
appropriates a prior invention by incorporating
its innovative concept and, although with some
modification and change, performs
substantially the same function in
substantially the same way to achieve
substantially the same result. The principle or
mode of operation must be the same or
substantially the same. The doctrine of
equivalents thus requires satisfaction of the
function-means-and-result test, the patentee
having the burden to show that all three
components of such equivalency test are met.
[Smith Klein Beckman Corp. v. CA (2003)]
H.4. DEFENSES IN ACTION FOR
INFRINGEMENT
In an action for infringement, the defendant, in
addition to other defenses available to him,
may show the invalidity of the patent, or any
claim thereof, on any of the grounds on which
a petition of cancellation can be brought under
Section 61. [Sec 81, RA 8293]
i. Patent found invalid may be cancelled:
In an action for infringement, if the court shall
find the patent or any claim to be invalid, it
shall cancel the same, and the Director of
Legal Affairs upon receipt of the final
judgment of cancellation by the court, shall
record that fact in the register of the Office and
shall publish a notice to that effect in the IPO
Gazette. [Sec 82, RA 8293]
ii. Doctrine of File Wrapper Estoppel
Patentee is precluded from claiming as part of
patented product that which he had to excise
or modify in order to avoid patent office
rejection, and he may omit any additions he
was compelled to add by patent office
regulations. [Advance Transformer Co. v.
Levinson 837 F.2d 1081(1988)]
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MERCANTILE LAW
I. LICENSING
I.1. VOLUNTARY
Voluntary Licensing is the grant by the patent
owner to a third person of the right to exploit
the patented invention. [Sec. 85, RA 8293]
i. Mandatory Provisions
The following provisions shall be included in
voluntary license contracts:
(1) That the laws of the Philippines shall
govern the interpretation of the same and
in the event of litigation, the venue shall be
the proper court in the place where the
licensee has its principal office; [Sec. 88.1,
RA 8293]
(2) Continued access to improvements in
techniques and processes related to the
technology shall be made available during
the period of the technology transfer
arrangement; [Sec. 88.2, RA 8293]
(3) In the event the technology transfer
arrangement shall provide for arbitration,
the Procedure of Arbitration of the
Arbitration Law of the Philippines or the
Arbitration Rules of the United Nations
Commission on International Trade Law
(UNCITRAL) or the Rules of Conciliation
and Arbitration of the International
Chamber of Commerce (ICC) shall apply
and the venue of arbitration shall be the
Philippines or any neutral country; [Sec.
88.3, RA 8293]
(4) The Philippine taxes on all payments
relating to the technology transfer
arrangement shall be borne by the licensor.
[Sec. 88.4, RA 8293]
ii. Prohibited clauses
The following provisions shall be deemed
prima facie to have an adverse effect on
competition and trade:
(1) Those which impose upon the licensee the
obligation to acquire from a specific source
capital goods, intermediate products, raw
materials, and other technologies, or of
permanently employing personnel
UP LAW BOC INTELLECTUAL PROPERTY CODE
indicated by the licensor; [Sec. 87.1, RA
8293]
(2) Those pursuant to which the licensor
reserves the right to fix the sale or resale
prices of the products manufactured on the
basis of the license; [Sec. 87.2, RA 8293]
(3) Those that contain restrictions regarding
the volume and structure of production;
[Sec. 87.3, RA 8293]
(4) Those that prohibit the use of competitive
technologies in a non-exclusive technology
transfer agreement; [Sec. 87.4, RA 8293]
(5) Those that establish a full or partial
purchase option in favor of the licensor;
(Sec. 87.5, RA 8293)
(6) Those that obligate the licensee to transfer
for free to the licensor the inventions or
improvements that may be obtained
through the use of the licensed technology;
(Sec. 87.6, RA 8293)
(7) Those that require payment of royalties to
the owners of patents for patents which are
not used; (Sec. 87.7, RA 8293)
(8) Those that prohibit the licensee to export
the licensed product unless justified for the
protection of the legitimate interest of the
licensor such as exports to countries where
exclusive licenses to manufacture and/or
distribute the licensed product(s) have
already been granted; (Sec. 87.8, RA 8293)
(9) Those which restrict the use of the
technology supplied after the expiration of
the technology transfer arrangement,
except in cases of early termination of the
technology transfer arrangement due to
reason(s) attributable to the licensee; (Sec.
87.9, RA 8293)
(10) Those which require payments for patents
and other industrial property rights after
their expiration, termination arrangement;
(Sec. 87.10, RA 8293)
(11) Those which require that the technology
recipient shall not contest the validity of
any of the patents of the technology
supplier; (Sec. 87.11, RA 8293)
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MERCANTILE LAW
(12) Those which restrict the research and
development activities of the licensee
designed to absorb and adapt the
transferred technology to local conditions
or to initiate research and development
programs in connection with new products,
processes or equipment; (Sec. 87.12, RA
8293)
(13) Those which prevent the licensee from
adapting the imported technology to local
conditions, or introducing innovation to it,
as long as it does not impair the quality
standards prescribed by the licensor; (Sec.
87.13, RA 8293)
(14) Those which exempt the licensor for
liability for non-fulfillment of his
responsibilities under the technology
transfer arrangement and/or liability
arising from third party suits brought
about by the use of the licensed product or
the licensed technology; (Sec. 87.14, RA
8293)
(15) Other clauses with equivalent effects. (Sec.
87.15, RA 8293)
Effect of Non-compliance with any provisions of
Secs. 87 and 88
The technology transfer arrangement shall
automatically be rendered unenforceable,
unless said technology transfer arrangement is
approved and registered with the
Documentation, Information and Technology
Transfer Bureau under the provisions of
Section 91 on exceptional cases. [Sec. 92, RA
8293]
Right of Licensor. Unless otherwise provided
in the technology transfer agreement, the
licensor shall have the right to:
(1) Grant further licenses to third person
(2) Exploit the subject matter of the
technology transfer agreement [Sec. 89,
RA 8293]
Right of the Licensee. To exploit the subject
matter of the technology transfer agreement
UP LAW BOC INTELLECTUAL PROPERTY CODE
during the whole term of the agreement. [Sec.
90, RA 8293]
Exceptional cases
(1) In exceptional or meritorious cases where
substantial benefits will accrue to the
economy, such as high technology content,
increase in foreign exchange earnings,
employment generation, regional dispersal
of industries and/or substitution with or
use of local raw materials
(2) The case of BOI-registered companies with
pioneer status [Sec. 91, RA 8293]
I.2. COMPULSORY
Compulsory Licensing is the grant of the
Director of Legal Affairs of a license to exploit a
patented invention, even without the
agreement of the patent owner, in favor of any
person who has shown his capability to exploit
the invention. (Sec. 93, Ra 8293 as amended by
RA 9502)
i. Grounds
The Director General of the Intellectual
Property Office may grant a license to exploit a
patented invention, even without the
agreement of the patent owner, in favor of any
person who has shown his capability to exploit
the invention, under any of the following
circumstances:
(1) National emergency or other
circumstances of extreme urgency; [Sec.
93.1, RA 8293 as amended by RA 9502]
(2) Where the public interest, in particular,
national security, nutrition, health or the
development of other vital sectors of the
national economy as determined by the
appropriate agency of the Government, so
requires; [Sec. 93.2, RA 8293 as amended
by RA 9502]
(3) Where a judicial or administrative body has
determined that the manner of
exploitation by the owner of the patent or
his licensee is anti-competitive; [Sec. 93.3,
RA 8293 as amended by RA 9502]
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MERCANTILE LAW
(4) In case of public non-commercial use of
the patent by the patentee, without
satisfactory reason; [Sec. 93.4, RA 8293 as
amended by RA 9502]
(5) If the patented invention is not being
worked in the Philippines on a commercial
scale, although capable of being worked,
without satisfactory reason: Provided, That
the importation of the patented article
shall constitute working or using the
patent; [Sec. 93.5, RA 8293 as amended by
RA 9502]
(6) Where the demand for patented drugs and
medicines is not being met to an adequate
extent and on reasonable terms, as
determined by the Secretary of the
Department of Health. [Sec. 93.6, RA 8293
as amended by RA 9502]
(7) If the invention protected by a patent,
hereafter referred to as the "second
patent," within the country cannot be
worked without infringing another patent,
hereafter referred to as the "first patent,"
granted on a prior application or benefiting
from an earlier priority, a compulsory
license may be granted to the owner of the
second patent to the extent necessary for
the working of his invention, subject to
certain conditions. [Sec. 97, RA 8293]
(8) Manufacture and export of drugs and
medicines to any country having
insufficient or no manufacturing capacity
in the pharmaceutical sector to address
public health problems: Provided, That, a
compulsory license has been granted by
such country or such country has, by
notification or otherwise, allowed
importation into its jurisdiction of the
patented drugs and medicines from the
Philippines in compliance with the TRIPS
Agreement. [Sec. 93-A.2, RA 8293 as
amended by RA 9502]
UP LAW BOC INTELLECTUAL PROPERTY CODE
ii. Period of filing a Petition for Compulsory
License
At any time after the grant of patent. However,
a compulsory license may not be applied for on
the ground stated in Sec. 93.5 before the
expiration of a period of four (4) years from the
date of filing of the application or three (3)
years from the date of the patent whichever
period expires last. [Sec. 94, RA 8293 as
amended by RA 9502]
iii. Requirement to Obtain a License on
Reasonable Commercial Terms
General Rule: The license will only be granted
after the petitioner has made efforts to obtain
authorization from the patent owner on
reasonable commercial terms and conditions
but such efforts have not been successful
within a reasonable period of time. [Sec. 95.1,
RA 8293 as amended by RA 9502]
Exceptions: The requirement of authorization
shall not apply in the following cases:
(1) Where the petition for compulsory license
seeks to remedy a practice determined
after judicial or administrative process to
be anti-competitive;
(2) In situations of national emergency or
other circumstances of extreme urgency;
(3) In cases of public non-commercial use.
(4) In cases where the demand for the
patented drugs and medicines in the
Philippines is not being met to an
adequate extent and on reasonable terms,
as determined by the Secretary of the
Department of Health. [Sec. 95.2, RA 8293
as amended by RA 9502]
iv. Terms and Conditions of Compulsory License
(1) The scope and duration of such license
shall be limited to the purpose for which it
was authorized; [Sec. 100.1, RA 8293]
(2) The license shall be non-exclusive; [Sec.
100.2, RA 8293]
(3) The license shall be non-assignable,
except with that part of the enterprise or
business with which the invention is being
exploited; ; [Sec. 100.3, RA 8293]
274
MERCANTILE LAW
(4) Use of the subject matter of the license
shall be devoted predominantly for the
supply of the Philippine market: Provided,
that this limitation shall not apply where
the grant of the license is based on the
ground that the patentee's manner of
exploiting the patent is determined by
judicial or administrative process, to be
anti-competitive. ;[Sec. 100.4, RA 8293]
(5) The license may be terminated upon
proper showing that circumstances which
led to its grant have ceased to exist and are
unlikely to recur: Provided, That adequate
protection shall be afforded to the
legitimate interest of the licensee; ; [Sec.
100.5, RA 8293]
(6) The patentee shall be paid adequate
remuneration taking into account the
economic value of the grant or
authorization, except that in cases where
the license was granted to remedy a
practice which was determined after
judicial or administrative process, to be
anti-competitive, the need to correct the
anti-competitive practice may be taken
into account in fixing the amount of
remuneration. [Sec. 100.6, RA 8293]
J. ASSIGNMENT AND TRANSMISSION
OF RIGHTS
J.1. ASSIGNMENT OF RIGHTS
The assignment may be of the entire patent or
a portion thereof, or be limited to a specified
territory. [Sec. 104, RA 8293]
J.2. TRANSMISSION OF RIGHTS
Patents or applications for patents and
invention to which they relate, shall be
protected in the same way as the rights of
other property under the Civil Code. [Sec. 103.1,
RA 8293]
Inventions and any right, title or interest in and
to patents and inventions covered thereby,
may be assigned or transmitted by inheritance
or bequest or may be the subject of a license
contract. (Sec. 103.2, RA 8293)
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A. DEFINITION OF MARKS,
J.3. REQUIREMENTS FOR RECORDING
COLLECTIVE MARKS, TRADE NAMES
OF ASSIGNMENT
A.1. MARKS
(1) It must be in writing and accompanied by
Any visible sign capable of distinguishing the
an English translation, if it is in a language
goods (trademark) or services (service mark) of
other than English or Filipino
an enterprise and shall include a stamped or
(2) It must be notarized
marked container of goods (Sec. 121.1, RA 8293)
(3) It must be accompanied by an
appointment of a resident agent, if the
Trademark Service Mark
assignee is not residing in the Philippines
(4) It must identify the letters patent involved Any visible sign Any visible sign capable
by number and date and give the name of which is adopted and of distinguishing the
the owner of the patent and the title of the used to identify the services of an enterprise
invention. In the case of an application for source of origin of from the service of other
a patent, it should state the application goods, and which is enterprises.
number and the filing date of the capable of
application and give the name of the distinguishing them
applicant and the title of the invention. If from goods
the assignment was executed concurrently emanating from a
with or subsequent to the execution of the competitor.
application but before the application is
Protection
filed or before its application number is
ascertained, it should adequately identify Is not limited to similar marks but also products
the application by its date of execution, the that may case insidious damage.
name of the applicant, and the title of the
Collective Marks
invention.
Any visible sign designated as such in the
(5) It must be accompanied by the required
application for registration and capable of
fees. [Sec. 105; Rules and Regulations on
distinguishing the origin or any other common
Inventions, Rule 1200]
characteristic, including the quality of goods or
J.4. EFFECT OF NON-RECORDING OF services of different enterprises which use the
ASSIGNMENT WITH THE IPO sign under the control of the registered owner of
The non-recording will not affect the binding the collective mark. (Sec. 121.2, RA 8293)
agreement between the assignor and assignee.
Trade Name
However, such registration would be necessary
The name or designation identifying or
to bind third parties. An assignment would be
distinguishing an enterprise (Sec. 121.3, RA
void as against any subsequent purchaser or
8293).
mortgagee for valuable consideration and
without notice unless recorded in the IPO
Any individual name or surname, firm name,
within 3 months from the date of the
device or word used by manufacturers,
assignment or prior to the subsequent
industrialists, merchants, and others to identify
purchase or mortgage. (Sec. 106, RA 8293)
their businesses, vocations or occupations.
[Converse Rubber Corp. v. Universal Rubber
Products, Inc. (1980)]
III. Trademarks A.2. FUNCTIONS OF A TRADEMARK

275
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(1) To point out distinctly the origin or
ownership of the goods and to which it is
affixed;
(2) To secure him, who has been instrumental
in bringing into the market a superior
article of merchandise, the fruit of his
industry and skill;
(3) To assure the public that they are
producing the genuine article;
(4) To prevent fraud and imposition; and
(5) To protect the manufacturer against
substitution and sale of an inferior and
different article as its product [Mirpuri v.
CA (1998)]
B. ACQUISITION OF OWNERSHIP OF
MARK
The rights to a mark shall be acquired through
registration made validly in accordance with
law. [Sec. 122, RA 8293]
A certificate of registration shall remain in
force for 10 years (Sec. 145, RA 8293) and may
be renewed for periods of 10 years at its
expiration upon payment of the prescribed fee
and upon filing of a request. [Sec 146, RA 8293]
C. ACQUISITION OF OWNERSHIP OF
TRADE NAME
Notwithstanding any laws or regulations
providing for any obligation to register trade
names, such names shall be protected, even
prior to or without registration, against any
unlawful act committed by third parties. [Sec.
165.2 (a), RA 8293) The ownership of a trade
name is acquired through adoption and use.
A name or designation may not be used as a
trade name if by its nature or the use to which
such name or designation may be put, it is
contrary to public order or morals and if, in
particular, it is liable to deceive trade circles or
the public as to the nature of the enterprise
identified by that name. [Sec. 165.1, RA 8293]
Any change in the ownership of a trade name
shall be made with the transfer of the
276
MERCANTILE LAW
enterprise or part thereof identified by that
name. [Sec. 165.4, RA 8293]
D. NON-REGISTRABLE MARKS
A mark cannot be registered if it:
(1) Consists of immoral, deceptive or
scandalous matter, or matter which may
disparage or falsely suggest a connection
with persons, living or dead, institutions,
beliefs, or national symbols, or bring them
into contempt or disrepute; [Sec 123.1(a),
RA 8293]
(2) Consists of flags, coat of arms or other
insignia of the Philippines or any foreign
country; [Sec 123.1(b), RA 8293]
(3) Consists of a name, portrait or signature
identifying a particular living individual
except by his written consent, or of a
deceased President of the Philippines,
during the life of his widow, except by
written consent of the widow; [Sec 123.1(c),
RA 8293]
(4) Is identical with a registered mark of
another or a mark with an earlier filing or
priority date, in respect of:
(a) The same goods or services, or
(b) Closely related goods or services, or
(c) If it nearly resembles such a mark as to
be likely to deceive or cause confusion;
[Sec 123.1(d), RA 8293]
(5) Is identical with, or confusingly similar to,
or constitutes a translation of a well-
known mark, whether or not registered in
the Philippines, and used for identical or
similar goods or services; [Sec 123.1(e), RA
8293]
(6) Is identical with, or confusingly similar to,
or constitutes a translation of a well-
known mark which is registered in the
Philippines, and used for goods or services
which are not similar; [Sec 123.1(f), RA
8293]
(7) Likely to mislead the public, particularly as
to the nature, quality, characteristics or
geographical origin of the goods or
services; [Sec 123.1(g), RA 8293]
UP LAW BOC INTELLECTUAL PROPERTY CODE
(8) Consists exclusively of signs that are
generic for the goods or services that they
seek to identify; [Sec 123.1(h), RA 8293]
(9) Consists exclusively of signs or of
indications that have become customary or
usual to designate the goods or services in
everyday language or in a bona fide and
established trade practice; [Sec 123.1(i), RA
8293]
(10) Consists exclusively of signs or of
indications that may serve in trade to
designate the kind, quality, quantity,
intended purpose, value, geographical
origin, time or production of the goods or
rendering of the services, or other
characteristics of the goods or services;
[Sec 123.1(j), RA 8293]
(11) Consists of shapes that may be
necessitated by technical factors or by the
nature of the goods themselves or factors
that affect their intrinsic value; [Sec 123.1(k),
RA 8293]
(12) Consists of color alone, unless defined by a
given form; [Sec 123.1(l), RA 8293]
(13) Is contrary to public order or morality. [Sec
123.1(m), RA 8293]
D.1. DOCTRINE OF SECONDARY
MEANING
When the marks referred to in nos. 10, 11 and 12
has become distinctive, because of its long,
continuous and exclusive use for 5 years, as
used in connection with the applicants goods
or services in commerce and in the mind of the
public indicates a single source to consumers,
it may be registered. The Office may accept as
prima facie evidence that the mark has become
distinctive, as used in connection with the
applicant's goods or services in commerce,
proof of substantially exclusive and continuous
use thereof by the applicant in commerce in
the Philippines for five (5) years before the date
on which the claim of distinctiveness is made.
[Sec 123.2, RA 8293]
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MERCANTILE LAW
The nature of the goods to which the mark is
applied will not constitute an obstacle to
registration. [Sec 123.3, RA 8293]
E. PRIOR USE OF MARK AS A
REQUIREMENT
E.1. USE OF MARK AS A REQUIREMENT
The applicant or the registrant shall file a
declaration of actual use of the mark with
evidence to that effect, as prescribed by the
Regulations within three (3) years from the
filing date of the application. Otherwise, the
application shall be refused or the mark shall
be removed from the Register by the Director.
[Sec. 124.2, RA 8293]
For the requirement of actual use in
commerce in the Philippines before one may
register a trademark, trade name and service
mark under the law pertains to the territorial
jurisdiction of the Philippines and is not only
confined to a certain region, province, city or
barangay. [McDonalds Corporation v. MacJoy
Fastfood (2007)]
Trademark is a creation of use and, therefore,
actual use is a pre-requisite to exclusive
ownership; registration is only an
administrative confirmation of the existence of
the right of ownership of the mark, but does
not perfect such right; actual use thereof is the
perfecting ingredient. [Shangri-La International
Hotel v. DCC (2006)]
E.2. NON-USE OF MARK WHEN
EXCUSED
(1) If caused by circumstances arising
independently of the will of the trademark
owner. Lack of funds shall not excuse non-
use of a mark; [Sec. 152.1, RA 8293]
(2) A use which does not alter its distinctive
character though the use is different from
the form in which it is registered. [Sec.
152.2, RA 8293]
UP LAW BOC INTELLECTUAL PROPERTY CODE
(3) Use of a mark in connection with one or
more of the goods/services belonging to
the class in which the mark is registered.
[Sec. 152.3, RA 8293]
(4) The use of mark by a company related to
the applicant or registrant
(5) The use of mark by a person controlled by
the registrant. [Sec. 152.4, RA 8293]
The use of a mark by a company related with
the registrant or applicant shall inure to the
latter's benefit, and such use shall not affect
the validity of such mark or of its registration:
Provided, that such mark is not used in such
manner as to deceive the public. [Sec.152.4, Ra
8293]
F. TESTS TO DETERMINE
CONFUSING SIMILARITY BETWEEN
MARKS
F.1. DOMINANCY TEST
Infringement is determined by the test of
dominancy rather than by differences or
variations in the details of one trademark and
of another. Similarity in size, form and color,
while relevant is not conclusive. If the
competing trademark contains the main or
essential or dominant features of another, and
confusion is likely to result, infringement takes
place. [Asia Brewery v. CA and San Miguel
(1993)]
F.2. HOLISTIC TEST
To determine whether a trademark has been
infringed, we must consider the mark as a
whole and not as dissected. If the buyer is
deceived, it is attributable to the marks as a
totality, not usually to any part of it. The court
therefore should be guided by its first
impression, for the buyer acts quickly and is
governed by a casual glance, the value of
which may be dissipated as soon as the court
assumed to analyze carefully the respective
features of the mark. [Del Monte Corporation, et
al. v. CA (1990)]
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MERCANTILE LAW
The dominancy test considers the dominant
features in the competing marks in
determining whether they are confusingly
similar. Under the dominancy test, courts give
greater weight to the similarity of the
appearance of the product arising from the
adoption of the dominant features of the
registered mark, disregarding minor
differences. Courts will consider more the
aural and visual impressions created by the
marks in the public mind, giving little weight to
factors like prices, quality, sales outlets and
market segments.[McDonalds Corporation v.
L.C. Big Mak Burger, Inc., et al. (2004)]
F.3. AS TO THE GOODS OR SERVICES IN
CONNECTION WITH WHICH THE MARKS
ARE USED (DOCTRINE OF RELATED
GOODS/SERVICES)
(1) Goods are related when they belong to the
same class or have the same descriptive
properties or physical attributes, or they
serve the same purpose or flow through
the same channel of trade.
(2) The use of identical marks on non-
competing but related goods may likely
cause confusion.
(3) Corollarily, the use of identical marks on
non-competing and unrelated goods is not
likely to cause confusion.
G. WELL-KNOWN MARKS
A well-known mark is a mark which a
competent authority of the Philippines has
designated to be well-known internationally
and in the Philippines.
In determining whether a mark is well-known,
account shall be taken of the knowledge of the
relevant sector of the public, rather than the
public at large, including knowledge in the
Philippines which has been obtained as a
result of the promotion of the mark. (Sec
123.1(e), RA 8293)
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G.1. DETERMINANTS (NEED NOT accordance with the Sec. 123.1 (e), which is
CONCUR) registered in the Philippines with respect to
(1) The duration, extent and geographical goods or services which are not similar to those
area of any use of the mark; with respect to which registration is applied for.
(2) The market share in the Philippines and [Sec 123.1(f), RA 8293]
other countries of the goods/services to
Priority Right
which the mark applies;
An application for registration of a mark filed
(3) The degree of the inherent or acquired
in the Philippines by a person referred to in
distinction of the mark;
Section 3, and who previously duly filed an
(4) The quality-image or reputation acquired
application for registration of the same mark in
by the mark;
one of those countries, shall be considered as
(5) The extent to which the mark has been
filed as of the day the application was first filed
registered in the world;
in the foreign country. [Sec. 131.1, RA 8293]
(6) The exclusivity of the registration attained
by the mark in the world;
No registration of a mark in the Philippines by
(7) The extent of use of the mark in the world;
a person described in this section shall be
(8) The exclusivity of use in the world;
granted until such mark has been registered in
(9) The commercial value attributed to the
the country of origin of the applicant. [Sec.
mark in the world;
131.2, RA 8293]
(10) The record of successful protection of the
rights in the mark;
Significance of Priority Right
(11) The outcome of litigations dealing with the
A Philippine application filed by another
issue of whether the mar is well-known;
applicant after the priority date but earlier
and
than the foreign applicants actual filing may
(12) The presence or absence of identical or
be refused registration if it is identical to the
similar test marks validly registered or
mark with a priority date. [The Law on
used on other similar goods [Rule 102, Rule
Trademark, Infringement and Unfair
on Trademarks]
Competition, Agpalo]
G.2. PROTECTION EXTENDED TO WELL-
G.3. RIGHTS CONFERRED BY A WELL-
KNOWN MARKS
KNOWN MARK
i. If not registered in the Philippines
(1) Right to be protected whether or not it is
A mark cannot be registered if it is identical
registered in the Philippines;
with or confusingly similar to, or constitutes a
(2) If registered under Sec 123.1(e), extension
translation of a mark which is considered by
of protection to goods and services which
the competent authority of the Philippines to
are not similar to those in respect of which
be well-known internationally and in the
the mark is registered, provided that:
Philippines, whether or not it is registered here,
(a) The use of the mark in relation to
as being already the mark of a person other
unrelated or dissimilar goods or
than the applicant for registration and used for
services would indicate a
identical goods or services. [(Sec 123.1(e), RA
connection between those goods
8293]
or services and the owner of the
mark; and
ii. If registered in the Philippines
(b) The interests of the owner of the
A mark cannot be registered if it is identical
registered mark are likely to be
with or confusingly similar to, or constitutes a
translation of a mark considered well-known in
279
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damaged by such use. [Sec. 147.2,
RA 8293]
H. RIGHTS CONFERRED BY
REGISTRATION
Except in cases of importation of drugs and
medicines allowed under Section 72.1 of this
Act and of off-patent drugs and medicines, the
owner of a registered mark shall have the
exclusive right to prevent all third parties not
having the owner's consent from using in the
course of trade identical or similar signs or
containers for goods or services which are
identical or similar to those in respect of which
the trademark is registered where such use
would result in a likelihood of confusion. In
case of the use of an identical sign for identical
goods or services, a likelihood of confusion
shall be presumed. [Sec. 147.1, RA 8293 as
amended by RA 9502]
H.1. LIMITATIONS ON SUCH RIGHTS
(1) Duration (except that, inasmuch as the
registration of a trademark could be
renewed every 10 years, a trademark could
conceivably remain registered forever);
(2) Territorial (except well-known marks).
Registration of the mark shall not confer on
the registered owner the right to preclude third
parties from using bona fide their names,
addresses, pseudonyms, a geographical name,
or exact indications concerning the kind,
quality, quantity, destination, value, place of
origin, or time of production or of supply, of
their goods or services: Provided, That such use
is confined to the purposes of mere
identification or information and cannot
mislead the public as to the source of the
goods or services. [Sec. 148, RA 8293]
H.2. ASSIGNMENT AND TRANSFER OF
APPLICATION AND REGISTRATION
(1) An application for registration of a mark, or
its registration, may be assigned or
transferred with or without the transfer of
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the business using the mark. [Sec. 149.1,
RA 8293]
(2) Such assignment or transfer shall, however,
be null and void if it is liable to mislead the
public, particularly as regards the nature,
source, manufacturing process,
characteristics, or suitability for their
purpose, of the goods or services to which
the mark is applied. [Sec. 149.2, RA 8293]
(3) The assignment of the application for
registration of a mark, or of its registration,
shall be in writing and require the
signatures of the contracting parties.
Transfers by mergers or other forms of
succession may be made by any document
supporting such transfer. [Sec. 149.3, RA
8293]
(4) Assignments and transfers of registrations
of marks shall be recorded at the Office on
payment of the prescribed fee; assignment
and transfers of applications for
registration shall, on payment of the same
fee, be provisionally recorded, and the
mark, when registered, shall be in the
name of the assignee or transferee. [Sec.
149.4, RA 8293]
(5) Assignments and transfers shall have no
effect against third parties until they are
recorded at the Office. [Sec. 149.5, RA
8293]
Any license contract concerning the
registration of a mark, or an application
therefor, shall provide for effective control by
the licensor of the quality of the goods or
services of the licensee in connection with
which the mark is used. If the license contract
does not provide for such quality control, or if
such quality control is not effectively carried
out, the license contract shall not be valid. [Sec.
150.1, RA 8293]
H.3. PROTECTION LIMITED TO GOODS
SPECIFIED IN REGISTRATION
CERTIFICATE
The certificate of registration can confer upon
the petitioner the exclusive right to use its own
UP LAW BOC INTELLECTUAL PROPERTY CODE
symbol only to those goods specified in the
certificate, subject to any conditions a
limitations stated therein. One who has
adopted and used a trademark on his goods
does not prevent the adoption and use of the
same trademark by others for products which
are of a different description. [Faberge, Inc. v.
IAC and Co Beng Kay (1992)]
I. USE BY THIRD PARTIES OF NAMES,
ETC. SIMILAR TO REGISTERED MARK
The IPC deems unlawful any subsequent use of
the trade name by a third party, whether as a
trade name or a mark or collective mark, or any
such use of a similar trade name or mark, likely
to mislead the public. [Sec. 165.2 (b), RA 8293]
J. INFRINGEMENT AND REMEDIES
J.1. TRADEMARK INFRINGEMENT
Any person who shall, without the consent of
the owner of the registered mark:
(1) Use in commerce any reproduction,
counterfeit, copy, or colorable imitation of
a registered mark or the same container or
a dominant feature thereof in connection
with the sale, offering for sale, distribution,
advertising of any goods or services
including other preparatory steps
necessary to carry out the sale of any
goods or services on or in connection with
which such use is likely to cause confusion,
or to cause mistake, or to deceive; [Sec.
155.1, RA 8293]
(2) Reproduce, counterfeit, copy or colorably
imitate a registered mark or a dominant
feature thereof and apply such
reproduction, counterfeit, copy or colorable
imitation to labels, signs, prints, packages,
wrappers, receptacles or advertisements
intended to be used in commerce upon or
in connection with the sale, offering for
sale, distribution, or advertising of goods
or services on or in connection with which
such use is likely to cause confusion, or to
cause mistake, or to deceive. [Sec. 155.2,
RA 8293]
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MERCANTILE LAW
A crucial issue in any trademark infringement
case is the likelihood of confusion, mistake or
deceit as to the identity, source or origin of the
goods or identity of the business as a
consequence of using a certain mark.
Likelihood of confusion is admittedly a relative
term, to be determined rigidly according to the
particular (and sometimes peculiar)
circumstances of each case. In determining
likelihood of confusion, the court must
consider: (a) the resemblance between the
trademarks; (b) the similarity of the goods to
which the trademarks are attached; (c) the
likely effect on the purchaser; and (d) the
registrants express or implied consent and
other fair and equitable considerations.
[Mighty Corporation v. E. & J. Gallo Winery
(2004)]
To establish trademark infringement, the
following elements must be shown: (1) the
validity of the mark; (2) the plaintiffs
ownership of the mark; and (3) the use of the
mark or its colorable imitation by the alleged
infringer results in likelihood of confusion. Of
these, it is the element of likelihood of
confusion that is the gravamen of trademark
infringement. Two types of confusion arise
from the use of similar or colorable imitation
marks, namely, confusion of goods (product
confusion) and confusion of business (source or
origin confusion). While there is confusion of
goods when the products are competing,
confusion of business exists when the products
are non-competing but related enough to
produce confusion or affiliation. [McDonalds
Corporation v. L.C. Big Mak Burger, Inc., et al.,
(2004)]
In order to bring a civil action for infringement,
it is not required that there is an actual sale of
the goods or services using the infringing
material. [Sec. 155.2, RA 8293] Infringement
takes place upon the mere use or reproduction
of the registered mark.
UP LAW BOC INTELLECTUAL PROPERTY CODE
No article of imported merchandise which shall
copy or simulate the name of any domestic
product, or manufacturer, or dealer, or which
shall copy or simulate a mark registered in
accordance with the provisions of this Act, or
shall bear a mark or trade name calculated to
induce the public to believe that the article is
manufactured in the Philippines, or that it is
manufactured in any foreign country or locality
other than the country or locality where it is in
fact manufactured, shall be admitted to entry
at any customhouse of the Philippines. [Sec.
166, RA 8293]
A mere distributor and not the owner cannot
assert any protection from trademark
infringement as it had no right in the first place
to the registration of the disputed trademarks.
[Superior Commercial Enterprises v. Kunnan
Enterprises (2010)]
J.2. FALSE DESIGNATIONS OF ORIGIN;
FALSE DESCRIPTION OR
REPRESENTATION
Any person who, on or in connection with any
goods or services, or any container for goods,
uses in commerce any word, term, name,
symbol, or device, or any combination thereof,
or any false designation of origin, false or
misleading description of fact, or false or
misleading representation of fact, which:
(1) Is likely to cause confusion, or to cause
mistake, or to deceive as to the affiliation,
connection, or association of such person
with another person, or as to the origin,
sponsorship, or approval of his or her
goods, services, or commercial activities by
another person; [Sec. 169.1(a), RA 8293]
(2) In commercial advertising or promotion,
misrepresents the nature, characteristics,
qualities, or geographic origin of his or her
or another person's goods, services, or
commercial activities, shall be liable to a
civil action for damages and injunction [Sec.
169.1 (b), RA 8293]
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MERCANTILE LAW
Any goods marked or labeled in contravention
of the provisions of this Section shall not be
imported into the Philippines or admitted entry
at any customhouse of the Philippines. The
owner, importer, or consignee of goods refused
entry at any customhouse under this section
may have any recourse under the customs
revenue laws or may have the remedy given by
this Act in cases involving goods refused entry
or seized. [Sec. 169.2, RA 8293]
J.3. INFRINGEMENT OF NAME AND
MARKS OF OWNERSHIP STAMP ON
CONTAINERS
General Rule: It is unlawful for any person,
without the consent of the manufacturer,
bottler or seller who has registered the mark of
ownership to fill such bottles, boxes, kegs,
barrels or other containers so marked and
stamped, for the purpose of sale, dispose of, or
wantonly destroy the same, whether filled or
not, to use the same for drinking vessels or
drain pipes, foundation pipes, for any other
purpose than that registered. [Sec. 2, RA 623
as amended by RA 5700]
The use of the same without apparent
permission from the trademark owners thereof
shall be prima facie presumption that such
possession or use is unlawful. [Sec. 3, RA 623
as amended by RA 5700]
Exceptions:
(1) Use of the bottles as containers for sisi,
bagoong, patis, and similar native
products [Sec. 6 RA 623 as amended by
RA 5700]
(2) Persons in whose favor the containers were
sold [Distelleria Washington v. LA Tondena
Distillers (1997)]
J.4. DAMAGES
The owner of a registered mark may recover
damages from any person who infringes his
rights, and the measure of the damages
suffered shall be either the reasonable profit
which the complaining party would have made,
UP LAW BOC INTELLECTUAL PROPERTY CODE
had the defendant not infringed his rights, or
the profit which the defendant actually made
out of the infringement, or in the event such
measure of damages cannot be readily
ascertained with reasonable certainty, then the
court may award as damages a reasonable
percentage based upon the amount of gross
sales of the defendant or the value of the
services in connection with which the mark or
trade name was used in the infringement of
the rights of the complaining party. [Sec. 156.1,
RA 8293]
The owner of the registered mark shall not be
entitled to recover profits or damages unless
the acts have been committed with knowledge
that such imitation is likely to cause confusion,
or to cause mistake, or to deceive. Such
knowledge is presumed if the registrant gives
notice that his mark is registered by displaying
with the mark the words '"Registered Mark" or
the letter R within a circle or if the defendant
had otherwise actual notice of the registration.
[Sec. 158, RA 8293]
Should damages be recoverable, the measure
of the damages suffered shall be either:
(1) The reasonable profit which the
complaining party would have made, had
the defendant not infringed his rights; or
(2) The profit which the defendant actually
made out of the infringement; or
(3) A reasonable percentage based upon the
amount of gross sales of the defendant or
the value of the services in connection with
which the mark or trade name was used in
the infringement of the rights of the
complaining party if such measure of
damages cannot be readily ascertained
with reasonable certainty. [Sec. 156.1, RA
8293]
J.5. REQUIREMENT OF NOTICE
Notice of registration of trademark is necessary
for an owner of a trademark to recover
damages in an action for infringement since
knowledge that such imitation is likely to cause
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MERCANTILE LAW
confusion, or to cause mistake, or to deceive is
an element of infringement. Requirement of
notice may be complied by displaying with the
mark the words '"Registered Mark" or the
letter R within a circle. [Sec. 158, RA 8293]
J.6. OTHER REMEDIES AVAILABLE:
(1) Injunction [Sec. 156.4];
(2) Impounding of sales invoices and other
documents [Sec. 156.2];
(3) Double damages in case of actual intent to
defraud or to mislead [Sec. 156.3];
(4) Court order for the disposal or destruction
of the infringing goods [Sec. 157];
(5) Criminal Action;
(6) Administration sanctions
Any foreign national, who qualifies under the
principle on reciprocity and does not engage in
business in the Philippines, whether or not it is
licensed to do business in the Philippines, may
bring civil or administrative action for:
(1) Opposition
(2) Cancellation
(3) Infringement
(4) Unfair Competition
(5) False designation of origin or false
description (Sec. 160. RA 8293)
J.7. LIMITATIONS TO ACTIONS FOR
INFRINGEMENT
The remedies given to the owner of a right
infringed shall be limited as follows:
(1) Registered mark shall have no effect
against any person who, in good faith,
before the filing date or the priority date,
was using the mark for the purposes of his
business or enterprise: Provided, That his
right may only be transferred or assigned
together with his enterprise or business or
with that part of his enterprise or business
in which the mark is used. [Sec. 159.1, RA
8293]
(2) Where an infringer who is engaged solely
in the business of printing the mark or
other infringing materials for others is an
UP LAW BOC INTELLECTUAL PROPERTY CODE
innocent infringer, the owner of the right
infringed shall be entitled as against such
infringer only to an injunction against
future printing. [Sec. 159.2, RA 8293]
(3) Where the infringement complained of is
contained in or is part of paid
advertisement in a newspaper, magazine,
or other similar periodical or in an
electronic communication, the remedies of
the owner of the right infringed as against
the publisher or distributor of such
newspaper, magazine, or other similar
periodical or electronic communication
shall be limited to an injunction against
the presentation of such advertising matter
in future issues of such newspapers,
magazines, or other similar periodicals or
in future transmissions of such electronic
communications.
The limitations shall apply only to innocent
infringers: Provided, That such injunctive
relief shall not be available to the owner of
the right infringed with respect to an issue
of a newspaper, magazine, or other similar
periodical or an electronic communication
containing infringing matter where
restraining the dissemination of such
infringing matter in any particular issue of
such periodical or in an electronic
communication would delay the delivery of
such issue or transmission of such
electronic communication is customarily
conducted in accordance with the sound
business practice, and not due to any
method or device adopted to evade this
section or to prevent or delay the issuance
of an injunction or restraining order with
respect to such infringing matter. [Sec.
159.3, RA 8293]
(4) There shall be no infringement of
trademarks or tradenames of imported or
sold drugs and medicines allowed under
Section 72.1 as well as imported or sold off-
patent drugs and medicines: Provided,
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MERCANTILE LAW
That said drugs and medicines bear the
registered marks that have not been
tampered, unlawfully modified, or
infringed upon as defined under Section
155. [Sec. 159.4 RA 8293 as amended by RA
9502]
K. UNFAIR COMPETITION
A person who has identified in the mind of the
public the goods he manufactures or deals in,
his business or services from those of others,
whether or not a registered mark is employed,
has a property right in the goodwill of the said
goods, business or services so identified, which
will be protected in the same manner as other
property rights. [Sec. 168.1, RA 8293]
Any person who shall employ deception or any
other means contrary to good faith by which he
shall pass off the goods manufactured by him
or in which he deals, or his business, or services
for those of the one having established such
goodwill, or who shall commit any acts
calculated to produce said result, shall be
guilty of unfair competition, and shall be
subject to an action therefor. [Sec. 168.2, RA
8293]
The following shall be deemed guilty of unfair
competition:
(1) Any person, who is selling his goods and
gives them the general appearance of
goods of another manufacturer or dealer,
either as to the goods themselves or in the
wrapping of the packages in which they are
contained, or the devices or words thereon,
or in any other feature of their appearance,
which would be likely to influence
purchasers to believe that the goods
offered are those of a manufacturer or
dealer, other than the actual manufacturer
or dealer, or who otherwise clothes the
goods with such appearance as shall
deceive the public and defraud another of
his legitimate trade, or any subsequent
vendor of such goods or any agent of any
UP LAW BOC INTELLECTUAL PROPERTY CODE
vendor engaged in selling such goods with
a like purpose; [Sec. 168.3(a), RA 8293]
(2) Any person who by any artifice, or device,
or who employs any other means
calculated to induce the false belief that
such person is offering the services of
another who has identified such services in
the mind of the public; [Sec. 168.3(b), RA
8293]
(3) Any person who shall make any false
statement in the course of trade or who
shall commit any other act contrary to
good faith of a nature calculated to
discredit the goods, business or services of
another. (Sec. 168.3(c), RA 8293)
The elements of an action for unfair
competition are: (1) confusing similarity in the
general appearance of the goods, and (2)
intent to deceive the public and defraud a
competitor. The confusing similarity may or
may not result from similarity in the marks, but
may result from other external factors in the
packaging or presentation of the goods. The
intent to deceive and defraud may be inferred
from the similarity in appearance of the goods
as offered for sale to the public. Actual
fraudulent intent need not be shown.
[McDonalds Corporation v. L.G. Big Mak Burger,
Inc., et al. (2004)]
An action for unfair competition is based on
the proposition that no dealer in merchandise
should be allowed to dress his goods in
simulation of the goods of another dealer, so
that purchasers desiring to buy the goods of
the latter would be induced to buy the goods of
the former. The most usual devices employed
in committing this crime are the simulation of
labels and the reproduction of form, color and
general appearance of the package used by
the pioneer manufacturer or dealer. [Caterpillar,
Inc v. Samson (2006)]
Articles 168.1 and 168.2 provide the concept
and general rule on the definition of unfair
competition. The law does not thereby cover
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MERCANTILE LAW
every unfair act committed in the course of
business; it covers only acts characterized by
deception or any other means contrary to
good faith in the passing off of goods and
services as those of another who has
established goodwill in relation with these
goods or services, or any other act calculated
to produce the same result.
What unfair competition is, is further
particularized under Section 168.3 when it
provides specifics of what unfair competition is
without in any way limiting the scope of
protection against unfair competition. Part of
these particulars is provided under Section
168.3(c) which provides the general catch-all
phrase that the petitioner cites. Under this
phrase, a person shall be guilty of unfair
competition who shall commit any other act
contrary to good faith of a nature calculated to
discredit the goods, business or services of
another. [Coca-Cola v. Gomez (2008)]
From jurisprudence, unfair competition has
been defined as the passing off (or palming off)
or attempting to pass off upon the public the
goods or business of one person as the goods
or business of another with the end and
probable effect of deceiving the public. It
formulated the true test of unfair
competition: whether the acts of defendant are
such as are calculated to deceive the ordinary
buyer making his purchases under the ordinary
conditions which prevail in the particular trade
to which the controversy relates. One of the
essential requisites in an action to restrain
unfair competition is proof of fraud; the intent
to deceive must be shown before the right to
recover can exist. The advent of the IP Code
has not significantly changed these rulings as
they are fully in accord with what Section 168
of the Code in its entirety provides. Deception,
passing off and fraud upon the public are still
the key elements that must be present for
unfair competition to exist.
UP LAW BOC INTELLECTUAL PROPERTY CODE
Infringement of
Unfair Competition
Trademark
Unauthorized use of a Passing off of ones
trademark goods as those of
another
Fraudulent intent is Fraudulent intent is
unnecessary essential
Prior registration of Registration is not
the trademark is a necessary
prerequisite to the
action
[In and Out Burger vs Sehwani (2008)]
The law on unfair competition is broader and
more inclusive than the law on trademark
infringement. The latter is more limited but it
recognizes a more exclusive right derived from
the trademark adoption and registration by the
person whose goods or business is first
associated with it. Hence, even if one fails to
establish his exclusive property right to a
trademark, he may still obtain relief on the
ground of his competitors unfairness or fraud.
Conduct constitutes unfair competition if the
effect is to pass off on the public the goods of
one man as the goods of another. [Mighty
Corporation v. E. & J. Gallo Winery (2004)]
L. TRADE NAMES OR BUSINESS
NAMES
It is the name or designation identifying or
distinguishing an enterprise. [Sec. 121.3, RA
8293]
Any individual name or surname, firm name,
device or word used by manufacturers,
industrialists, merchants, and others to identify
their businesses, vocations or occupations
[Converse Rubber Corp. v. Universal Rubber
Products, Inc. (1980)]
L.1. WHAT MAY NOT BE USED AS TRADE
NAME
(1) If by its nature or the use to which the
name or designation may be put, it is
contrary to public order or morals.
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MERCANTILE LAW
(2) If it is liable to deceive trade circles or the
public as to the nature of the enterprise
identified by the name
(3) If the trade name is similar to a mark or a
trade name owned by another person and
its use would likely mislead the public.
[Sec.165.1, RA 8293]
Acquisition of ownership: Trade names are
protected even prior to or without registration.
The ownership of a trade name is acquired
through adoption and use.
Right of owner: The IPC deems unlawful any
subsequent use of the trade name by a third
party, whether as a trade name or a mark or
collective mark, or any such use of a similar
trade name or mark, likely to mislead the
public. [Sec. 165.2 (b), RA 8293]
Trade names, unlike trademarks, need not be
registered with the IPO before an infringement
suit may be filed by its owner against the
owner of an infringing trademark. All that is
required is that the trade name is previously
used in trade or commerce in the Philippines.
[Prosource International v. Horphag Research
Management (2009)]
M. COLLECTIVE MARKS
A Collective mark is any visible sign designated
as such in the application for registration and
capable of distinguishing the origin or any
other common characteristic, including the
quality of goods or services of different
enterprises which use the sign under the
control of the registered owner of the collective
mark [Sec. 121.2, RA 8293]
An application for registration of a collective
mark shall designate the mark as a collective
mark and shall be accompanied by a copy of
the agreement, if any, governing the use of the
collective mark. [Sec. 167.2, Ra 8293]
UP LAW BOC INTELLECTUAL PROPERTY CODE
M.1. GROUNDS FOR CANCELLATION
In addition to the grounds under Section 149,
the Court shall cancel the registration of a
collective mark if the person requesting the
cancellation proves:
(1) That only the registered owner uses the
mark; or
(2) That he uses or permits its use in
contravention of the agreements referred
to in Subsection 166.2; or
(3) That he uses or permits its use in a manner
liable to deceive trade circles or the public
as to the origin or any other common
characteristics of the goods or services
concerned. [Sec. 167.3, RA 8293]
The registration of a collective mark, or an
application therefor shall not be the subject of a
license contract. [Sec. 167.4, RA 8293]
IV. Copyrights
A. DEFINITION
Is that system of legal protection an author
enjoys of the form of expression of ideas.
[Aquino, Intellectual Property Law]
B. BASIC PRINCIPLES, SECTIONS
172.2, 175 AND 181
B.1. WORKS ARE PROTECTED BY THE
SOLE FACT OF THEIR CREATION
Principle of Automatic Protection: Copyright is
vested from the very moment of creation. [Sec.
172.2, RA 8293]
The enjoyment and exercise of copyright,
including moral rights, shall not be the subject
of any formality; such enjoyment and such
exercise shall be independent of the existence
of protection in the country of origin of the
work. [Article 5(2), Berne Convention for the
Protection of Literary and Artistic Works]
The Denicola Test in intellectual property law
states that if design elements of an article
reflect a merger of aesthetic and functional
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MERCANTILE LAW
considerations, the artistic aspects of the work
cannot be conceptually separable from the
utilitarian aspects; thus, the article cannot be
copyrighted.
B.2. PROTECTION EXTENDS ONLY TO
THE EXPRESSION OF AN IDEA, NOT THE
IDEA ITSELF.
No protection shall extend, under this law, to
any idea, procedure, system method or
operation, concept, principle, discovery or mere
data as such, even if they are expressed,
explained, illustrated or embodied in a work.
[Sec 175, RA 8293]
B.3. THE COPYRIGHT IS DISTINCT FROM
THE PROPERTY IN THE MATERIAL
OBJECT SUBJECT TO IT. [SEC 181, RA
8293]
B.4. COPYRIGHT IS A STATUTORY
RIGHT.
Copyright, in the strict sense of the term is
purely a statutory right. Being a mere statutory
grant, the rights are limited to what the statute
confers. It may be obtained and enjoyed only
with respect to the subjects and by the persons,
and on terms and conditions specified in the
statute. Accordingly, it can cover only the
works falling within the statutory enumeration
or description. [Pearl and Dean vs. Shoemart
(2003)]
C. COPYRIGHTABLE WORKS
C.1. ORIGINAL LITERARY AND ARTISTIC
WORKS
UP LAW BOC INTELLECTUAL PROPERTY CODE
Sec. 172.1, RA 8293. Literary and artistic
works, hereinafter referred to as "works",
are original intellectual creations in the
literary and artistic domain protected from
the moment of their creation and shall
include in particular:
(a) Books, pamphlets, articles and other
writings;
(b) Periodicals and newspapers;
(c) Lectures, sermons, addresses,
dissertations prepared for oral delivery,
whether or not reduced in writing or
other material form;
(d) Letters;
(e) Dramatic or dramatico-musical
compositions; choreographic works or
entertainment in dumb shows;
(f) Musical compositions, with or without
words;
(g) Works of drawing, painting,
architecture, sculpture, engraving,
lithography or other works of art;
models or designs for works of art;
(h) Original ornamental designs or models
for articles of manufacture, whether or
not registrable as an industrial design,
and other works of applied art;
(i) Illustrations, maps, plans, sketches,
charts and three-dimensional works
relative to geography, topography,
architecture or science;
(j) Drawings or plastic works of a scientific
or technical character;
(k) Photographic works including works
produced by a process analogous to
photography; lantern slides;
(l) Audiovisual works and cinematographic
works and works produced by a process
analogous to cinematography or any
process for making audio-visual
recordings;
(m) Pictorial illustrations and
advertisements;
(n) Computer programs; and
(o) Other literary, scholarly, scientific and
artistic works
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MERCANTILE LAW
When a work is considered original:
(1) The work is an independent creation of the
author; and
(2) It must not be copied from the work of
another.
A person to be entitled to a copyright must be
the original creator of the work. He must have
created it by his own skill, labor and judgment
without directly copying or evasively imitating
the work of another. [Ching Kian Chuan vs. CA
(2001)]
By originality is meant that the material was
not copied, and evidences at least minimal
creativity; that it was independently created by
the author and that it possesses at least some
minimal degree of creativity. Copying is shown
by proof of access to copyrighted material and
substantial similarity between the two works.
The applicant must thus demonstrate the
existence and validity of copyright because in
the absence of copyright protection, even the
original creation may be freely copied.[Ching v.
Salinas (2005)]
Originality is not determined by novelty,
aesthetic merit or ingenuity but that it is an
independent creation.
The requirement in US Law that the expression
should be fixed in a tangible medium is not
applicable here since our law expressly
provides that works are protected irrespective
of their mode or form of expression.[Sec. 172.2,
RA 8293]
C.2. DERIVATIVE WORKS
The following derivative works shall also be
protected by copyright:
(1) Dramatizations, translations, adaptations,
abridgments, arrangements, and other
alterations of literary or artistic works; and
(2) Collections of literary, scholarly or artistic
works, and compilations of data and other
materials which are original by reason of
UP LAW BOC INTELLECTUAL PROPERTY CODE
the selection or coordination or
arrangement of their contents. [Sec. 173.1,
RA 8293]
Derivative works are protected as new works
provided they shall not:
(a) Affect the force of any subsisting copyright
upon the original works employed or any
part thereof; or
(b) Be construed to imply any right to such use
of the original works, or to secure or extend
copyright in such original works. [Sec. 173.2,
RA 8293]
The provisions of the intellectual property code
shall apply to works in which copyright
protection obtained prior to the effectivity of
the law is subsisting. Provided that the
application of the code shall not result in the
diminution of such protection. [Sec. 239.3 IPC]
A person entitled to copyright must be the
original creator of the work. He must have
created it by his own skill, labor, and judgment
without directly copying or evasively imitating
the work of another. [Ching Kian Chuan vs CA
363 SCRA 142 (2001) (Vermicelli Case)]
To be entitled to copyright, the thing being
copyrighted must be original, created by the
author through his own judgment without
directly copying or evasively imitating the work
of another. [Sambar vs Levi Strauss 378 SCRA
364 (2002]:
D. NON-COPYRIGHTABLE WORKS
D.1. UNPROTECTED SUBJECT MATTER
(1) Any idea, procedure, system method or
operation, concept, principle, discovery or
mere data as such, even if they are
expressed, explained, illustrated or
embodied in a work;
(2) News of the day and other miscellaneous
facts having the character of mere items of
press information;
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MERCANTILE LAW
(3) Any official text of a legislative,
administrative or legal nature, as well as
any official translation thereof;
(4) Pleadings;
(5) Original decisions of courts and tribunals
(This pertains to the original decisions not
the SCRA published volumes since these are
protected under derivative works under Sec
173.1) [Sec. 175, RA 8293]
The format or mechanics of a TV show is not
copyrightable as copyright does not extend to
ideas, procedures, processes, systems,
methods of operation, concepts, principles or
discoveries regardless of the form in which they
are described, explained, illustrated or
embodied. [Joaquin Jr. et al vs. Drilon, et al
(1999)]
No one may claim originality as to facts as
these do not owe their origin to an act of
authorship. The first person to find and report
a particular fact has not created the same; he
has merely discovered its existence. [Feist
Publication v Rural Telephone Services (1991)]
D.2. WORKS OF THE GOVERNMENT OF
THE PHILIPPINES
Work of the Government of the Philippines: Is a
work created by an officer or employee of the
Philippine Government or any of its
subdivisions and instrumentalities, including
government-owned or controlled corporations
as a part of his regularly prescribed official
duties. [Sec. 171.11, RA 8293]
General Rule: Government cannot own
copyright
Exceptions:
(1) When copyright is assigned or bequested
in favor of the government [Sec 176.3];
(2) Author of speeches, lectures, sermons,
addresses and dissertations shall have
exclusive right of making a collection of his
work.
UP LAW BOC INTELLECTUAL PROPERTY CODE
However, prior approval of the government
agency or the office wherein the work is
created shall be necessary for the exploitation
of such work for profit. [Sec. 176.1]
Notwithstanding the foregoing provisions, the
Government is not precluded from receiving
and holding copyrights transferred to it by
assignment, bequest or otherwise; nor shall
publication or republication by the
Government in a public document of any work
in which copyright is subsisting be taken to
cause any abridgment or annulment of the
copyright or to authorize any use or
appropriation of such work without the consent
of the copyright owner. [Sec. 176.3, RA 8293]
In writing judicial decisions, a judge should
make the proper attribution in copying
passages from any judicial decision, statute,
regulation, or other Works of the Government.
However, the failure to make such attribution
does not violate the Law on Copyright. The law
expressly provides that Works of the
Government are not subject to copyright. This
means that there is neither a legal right by
anyone to demand attribution, nor any legal
obligation from anyone to make an attribution,
when Works of the Government are copied.
The failure to make the proper attribution of a
Work of the Government is not actionable but
is merely a case of sloppy writing. Clearly,
there is no legal obligation, by a judge or by
any person, to make an attribution when
copying Works of the Government. However,
misquoting or twisting, with or without
attribution, any judicial decision, statute,
regulation or other Works of the Government in
judicial writing, if done to mislead the parties
or the public, is actionable. [J. Carpio
Dissenting Opinion, In The Matter Of the
Charges of Plagiarism, Etc., Against Assoc.
Justice Mariano Del Castillo, A.M. 10-7-17-SC
(2011)]
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MERCANTILE LAW
D.3. WORKS OF THE PUBLIC DOMAIN
These include works whose term of copyright
has expired.
D.4. USEFUL ARTICLES
Useful Article Doctrine: Works whose sole
purpose is utilitarian have no separate artistic
value. This can be distinguished from a work of
applied art, which has utilitarian functions but
there is an identifiable artistic work or creation
incorporated thereto.
E. RIGHTS OF COPYRIGHT OWNER
E.1. COPYRIGHT OR ECONOMIC RIGHTS
Copyright or economic rights shall consist of
the exclusive right to carry out, authorize or
prevent the following acts:
(1) Reproduction of the work or substantial
portion of the work; [Sec. 177.1, RA 8293]
(2) Dramatization, translation, adaptation,
abridgment, arrangement or other
transformation of the work; [Sec. 177.2, RA
8293]
(3) The first public distribution of the original
and each copy of the work by sale or other
forms of transfer of ownership; [Sec. 177.3,
RA 8293]
(4) Rental of the original or a copy of an
audiovisual or cinematographic work, a
work embodied in a sound recording, a
computer program, a compilation of data
and other materials or a musical work in
graphic form, irrespective of the ownership
of the original or the copy which is the
subject of the rental; [Sec. 177.4, RA 8293]
(5) Public display of the original or a copy of
the work; [Sec. 177.5, RA 8293]
(6) Public performance of the work; [Sec. 177.6,
RA 8293]
(7) Other communication to the public of the
work [Sec. 177.7, RA 8293]
Economic rights also give the author the right
to assign or license the copyright and/or the
material object in whole or in part, and they
allow the owner to derive financial reward from
UP LAW BOC INTELLECTUAL PROPERTY CODE
the use of his works by others. [Sec. 180.1, RA
8293 as amended by RA 10372]
Copyright in a work of architecture: shall
include the right to control the erection of any
building which reproduces the whole or a
substantial part of the work either in its
original form or in any form recognizably
derived from the original: Provided, That the
copyright in any such work shall not include
the right to control the reconstruction or
rehabilitation in the same style as the original
of a building to which that copyright relates.
[Sec. 186, RA 8293]
Communication to the Public of Copyrighted
Works: Includes point-to-point transmission of
a work, including video on demand, and
providing access to an electronic retrieval
system, such as computer databases, servers,
or similar electronic storage devices.
Broadcasting, rebroadcasting, retransmission
by cable, and broadcast and retransmission by
satellite are all acts of communication to the
public within the meaning of the IPC. [Rule 11,
Copyright Safeguards and Regulations]
First Public Distribution of Work: An exclusive
right of first distribution of work includes all
acts involving distribution, specifically
including the first importation of an original
and each copy of the work into the jurisdiction
of the Republic of the Philippines. [Rule 12,
Copyright Safeguards and Regulations]
Civil Code Provisions on Ownership of
Intellectual Creation:
Article 721. By intellectual creation, the
following persons acquire ownership:
(1) The author with regard to his literary,
dramatic, historical, legal, philosophical,
scientific or other work;
(2) The composer; as to his musical
composition;
(3) The painter, sculptor, or other artist, with
respect to the product of his art;
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MERCANTILE LAW
(4) The scientist or technologist or any other
person with regard to his discovery or
invention.
Article 722. The author and the composer,
mentioned in Nos. 1 and 2 of the preceding
article, shall have the ownership of their
creations even before the publication of the
same. Once their works are published, their
rights are governed by the Copyright laws.
The painter, sculptor or other artist shall have
dominion over the product of his art even
before it is copyrighted. The scientist or
technologist has the ownership of his discovery
or invention even before it is patented.
Article 723. Letters and other private
communications in writing are owned by the
person to whom they are addressed and
delivered, but they cannot be published or
disseminated without the consent of the writer
or his heirs. However, the court may authorize
their publication or dissemination if the public
good or the interest of justice so requires.
E.2. MORAL RIGHTS [SEC. 193]
The author of a work shall, independently of
the economic rights in Section 177 or the grant
of an assignment or license with respect to
such right, have the right:
(1) To require that the authorship of the works
be attributed to him, in particular, the right
that his name, as far as practicable, be
indicated in a prominent way on the copies,
and in connection with the public use of his
work; [Sec. 193.1, RA 8293]
(2) To make any alterations of his work prior to,
or to withhold it from publication; [Sec.
193.2, RA 8293]
(3) To object to any distortion, mutilation or
other modification of, or other derogatory
action in relation to, his work which would
be prejudicial to his honor or reputation;
[Sec. 193.3, RA 8293]
UP LAW BOC INTELLECTUAL PROPERTY CODE
(4) To restrain the use of his name with
respect to any work not of his own creation
or in a distorted version of his work. [Sec.
193.4, RA 8293]
In addition to the right to publish granted by
the author, his heirs, or assigns, the publisher
shall have a copyright consisting merely of the
right of reproduction of the typographical
arrangement of the published edition of the
work. [Sec.174, RA 8293]
The author of speeches, lectures, sermons,
addresses, and dissertations mentioned in the
preceding paragraphs shall have the exclusive
right of making a collection of his works. [Sec.
176.2, Ra 8293]
i. Waiver of Moral Rights
General Rule: Moral rights can be waived in
writing, expressly stating such waiver [Sec. 195,
RA 8293] or by contribution to a collective work
unless such is expressly reserved [Sec. 196, RA
8293].
Exceptions:
Even if made in writing, waiver is still not valid
if:
(1) Use of the name of the author, title of his
work, or his reputation with respect to any
version or adaptation of his work, which
because of alterations substantially tends
to injure the literary or artistic reputation of
another author; [Sec. 195.1, RA 8293]
(2) It uses the name of the author in a work
that he did not create. [Sec. 195.1, RA
8293]
Moral rights are not assignable or subject to
license. [Sec. 198, RA 8293]
The right of an author under Section 193.1. shall
last during the lifetime of the author and in
perpetuity after his death while the rights under
Sections 193.2. 193.3. and 193.4. shall be
coterminous with the economic rights [Sec. 198,
RA 8293 as amended by RA 10372]
292
MERCANTILE LAW
E.3. RIGHTS TO PROCEEDS IN
SUBSEQUENT TRANSFERS (DROIT DE
SUITE OR FOLLOW UP RIGHTS)
In every sale or lease of an original work of
painting or sculpture or of the original
manuscript of a writer or composer,
subsequent to the first disposition thereof by
the author, the author or his heirs shall have an
inalienable right to participate in the gross
proceeds of the sale or lease to the extent of
five percent (5%). This right shall exist during
the lifetime of the author and for fifty (50)
years after his death. [Sec. 200, RA 8293]
Works not covered: Prints, etchings, engravings,
works of applied art, or works of similar kind
wherein the author primarily derives gain from
the proceeds of reproductions. (Sec. 201, RA
8293)
First Sale Doctrine: After the first sale of the
lawfully made copy of the copyrighted work,
anyone who is the owner of that copy can sell
or dispose of that copy in any way without any
liability for copyright infringement. The first
sale of an authorized copy of the work
exhausts the authors right to control
distribution of copies.
E.4. NEIGHBORING RIGHTS
E.5. PERFORMERS RIGHTS
(1) As regards their performances, the right of
authorizing:
(a) The broadcasting and other
communication to the public of
their performance; and
(b) The fixation of their unfixed
performance. [Sec. 203.1, RA 8293]
Such right shall be maintained and
exercised fifty (50) years after his death, by
his heirs, and in default of heirs, the
government, where protection is claimed.
[Sec. 204.2, RA 8293]
(2) The right of authorizing the direct or
indirect reproduction of their performances
UP LAW BOC INTELLECTUAL PROPERTY CODE
fixed in sound recordings, or audiovisual
works or fixations in any manner or form;
[Sec. 203.2, RA 8293, as amended by
10372]
(3) Subject to the provisions of Section 206,
the right of authorizing the first public
distribution of the original and copies of
their performance fixed in the sound
recording or audiovisual works or fixations
through sale or rental or other forms of
transfer of ownership; [Sec. 203.3, RA 8293,
as amended by RA 10372]
(4) The right of authorizing the commercial
rental to the public of the original and
copies of their performances fixed in sound
recordings or audiovisual works or fixations,
even after distribution of them by, or
pursuant to the authorization by the
performer; [Sec. 203.4, RA 8293, as
amended by RA 10372]
(5) The right of authorizing the making
available to the public of their
performances fixed in sound recordings or
audiovisual works or fixations, by wire or
wireless means, in such a way that
members of the public may access them
from a place and time individually chosen
by them. [Sec. 203.5, RA 8293, as amended
by RA 10372]
(6) Independently of a performer's economic
rights, the performer, shall, as regards his
live aural performances or performances
fixed in sound recordings or audiovisual
works or fixations, have the right to claim
to be identified as the performer of his
performances, except where the omission
is dictated by the manner of the use of the
performance, and to object to any
distortion, mutilation or other modification
of his performances that would be
prejudicial to his reputation. [Sec. 204.1,
RA 8293, as amended by RA 10372]
(7) Unless otherwise provided in the contract,
in every communication to the public or
broadcast of a performance subsequent to
the first communication or broadcast
293
MERCANTILE LAW
thereof by the broadcasting organization,
the performer shall be entitled to an
additional remuneration equivalent to at
least five percent (5%) of the original
compensation he or she received for the
first communication or broadcast. [Sec.
206, RA 8293]
E.6. RIGHTS OF PRODUCERS OF SOUND
RECORDING
(1) The right to authorize the direct or indirect
reproduction of their sound recordings, in
any manner or form; the placing of these
reproductions in the market and the right
of rental or lending; [Sec. 208.1, RA 8293]
(2) The right to authorize the first public
distribution of the original and copies of
their sound recordings through sale or
rental or other forms of transferring
ownership; [Sec. 208.2, RA 8293]
(3) The right to authorize the commercial
rental to the public of the original and
copies of their sound recordings, even after
distribution by them by or pursuant to
authorization by the producer. [Sec. 208.3,
RA 8293]
(4) If a sound recording published for
commercial purposes, or a reproduction of
such sound recording, is used directly for
broadcasting or for other communication
to the public, or is publicly performed with
the intention of making and enhancing
profit, a single equitable remuneration for
the performer or performers, and the
producer of the sound recording shall be
paid by the user to both the performers
and the producer, who, in the absence of
any agreement shall share equally. [Sec.
209, RA 8293]
E.7. RIGHTS OF BROADCASTING
ORGANIZATIONS
(1) The rebroadcasting of their broadcasts;
[Sec. 211.1, RA 8293]
(2) The recording in any manner, including the
making of films or the use of video tape, of
their broadcasts for the purpose of
UP LAW BOC INTELLECTUAL PROPERTY CODE MERCANTILE LAW

communication to the public of television been held that the playing of music in dine and
broadcasts of the same; [Sec. 211.2, RA dance establishments which was paid for by
8293] the public in purchases of food and drink
(3) The use of such records for fresh constitute performance for public. The music
transmissions or for fresh recording. [Sec. provided for is for the purpose of entertaining
211.3, RA 8293] and amusing customers in order to make the
establishment more attractive and desirable.
Must-Carry Rule: Prevents cable television The expenses entailed thereby are added to
companies from excluding broadcasting the overhead of the restaurant which are either
organization especially in those places not eventually charged to the price of the food and
reached by signal. Also, the rule prevents cable drink or the overall total of additional income
television companies from depriving viewers in produced by the bigger volume of business
far-flung areas the enjoyment of programs which the entertainment was programmed to
available to city viewers. [ABS-CBN attract. Nevertheless, the there is no
Broadcasting vs. Philippine Multi-Media System infringement of copyright law as the composers
(2009)] in this case waived their right in favour of the
public when they allowed their intellectual
Limitations on Protection creations to become property of public domain.
Sections 203, 208 and 209 shall not apply [Filipino Society of Composers vs Benjamin Tan
where the acts referred to in those Sections are 148 SCRA 461 (1987)]
related to:
(1) The use by a natural person exclusively for Term of Protection
his own personal purposes; Works Term
(2) Using short excerpts for reporting current
events; For performances not Fifty (50) years from
(3) Use solely for the purpose of teaching or incorporated in the end of the year in
for scientific research; and recordings which the
(4) Fair use of the broadcast subject to certain performance took
conditions. (Sec. 212, RA 8293) place [Sec. 215.1(a),
RA 8293]
The issue in this case as WON the playing and For sound or image and Fifty (50) years from
signing of musical compositions which have sound recordings and for the end of the year in
been copyrighted under the provisions of the performances which the recording
copyright law inside the restaurant constitute a incorporated therein took place. [Sec.
performance for profit? The court ruled that 215.1(b), RA 8293]
the word perform as used in the ACT has
been applied to one who plays a musical
composition on a piano, thereby producing in Broadcasts Twenty (20) years
the air sound waves which are heard as a from the date the
music and if the instrument he plays on is a broadcast took place
piano plus a broadcasting apparatus, so that [Sec. 215.2, RA 8293]
the waves are thrown out, not only upon the air
but upon others, then he also performing a
musical composition. In relation thereto it has

294
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F. RULES ON OWNERSHIP OF COPYRIGHT

F.1. OWNERSHIP OF COPYRIGHT
Work Ownership
Belongs to the author of the work [Sec. 178.1, RA
Single Creator of an Original Work
8293]
Belongs of the co-authors; in the absence of
agreement, their rights shall be governed by the rules
on co-ownership. However, if the work consists of
Works of Joint Authorship
parts that can be used separately and identified, the
author of each part owns the copyright of the part he
has created. [Sec. 178.2, RA 8293; Asked in 95, 04]
Belongs to the employee if the creation is not a part of
his regular duties, even if he used the time, facilities
and materials of the employer. However, belongs to
Work created during the course of employment the employer if the work is in the performance of the
employees regular duties unless there is an
agreement to the contrary. [Sec. 178.3, RA 8293;
Asked in 08]
The person who commissioned the work holds
Work commissioned by a person other than the ownership of the work per se, but copyright remains
employer with the creator unless there was a stipulation to the
contrary. [Sec. 178.4, RA 8293; Asked in 95, 04]
Belongs to the producer, author of the scenario,
composer of the music, film director, and author of
the adapted work. However, subject to stipulations,
the producers shall exercise the copyright as may be
Audio visual works
required for the exhibition of the work, except for the
right to collect license fees for the performance of
musical compositions in the work. [Sec. 178.5, RA
8293]
Belongs to the writer, but the court may authorize
their publication or dissemination of the public good
Letters
or interest of justice requires, pursuant to Art. 723,
New Civil Code. [Sec. 178.6, RA 8293]
Publishers are deemed to represent the authors,
unless the contrary appears, the pseudonyms or
Anonymous and pseudonymous works adopted names leave no doubt as to the authors
identity or if the author discloses his identity. [Sec.
179, RA 8293]
A contributor is deemed to have waived his right
Collective works
unless he expressly reserves it. [Sec. 196, RA 8293]
295
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F.2. DURATION OF COPYRIGHT
Works
Original Literary and Artistic Works including Lifetime of author and for fifty (50) years after his
Posthumous Works death [Sec 213.1, RA 8293]
Derivative Works including Posthumous Works
Joint Authorship
Anonymous or Pseudonymous Works
Applied Art
Published Photographic Works
Unpublished Photographic Works
Published Audio-visual Works
Unpublished Audio-visual Works
F.3. PRESUMPTION OF AUTHORSHIP
The natural person whose name is indicated on
a work in the usual manner as the author shall,
in the absence of proof to the contrary, be
presumed to be the author of the work. This
provision shall be applicable even if the name is
a pseudonym, where the pseudonym leaves no
doubt as to the identity of the author. The
person or body, corporate whose name appears
on an audio-visual work in the usual manner
shall, in the absence of proof to the contrary, be
presumed to be the maker of said work. [Sec.
219, RA 8293]
The term of protection subsequent to the death
of the author shall run from the date of his
death or of publication, but such terms shall
always be deemed to begin on the first day of
January of the year following the event which
gave rise to them. [Sec. 214, RA 8293]
296
MERCANTILE LAW
Term
Lifetime of author and for fifty (50) years after his
death [Sec 213.1, RA 8293]
Lifetime of the last surviving author and for fifty
(50) years after his death [Sec 213.2, RA 8293]
Fifty (50) years from date of first lawful
publication [Sec. 213.3, RA 8293]
Twenty-five (25) years from date of making [Sec.
213.4, RA 8293]
Fifty (50) years from publication [Sec. 213.5, RA
8293]
Fifty (50) years from the making [Sec. 213.5, RA
8293]
Fifty (50) years from publication [Sec. 213.6, RA
8293]
Fifty (50) years from the making [Sec. 213.6, RA
8293]
F.4. TRANSFER OR ASSIGNMENT OF
COPYRIGHT
The copyright may be assigned or licensed in
whole or in part. Within the scope of the
assignment or license, the assignee or licensee
is entitled to all the rights and remedies which
the assignor or licensor had with respect to the
copyright. [Sec. 180.1, RA 8293 as amended by
RA 10372]
The copyright is not deemed assigned or
licensed inter vivos in whole or in part unless
there is a written indication of such intention.
[Sec. 180.2, RA 8293 as amended by RA 10372]
The submission of a literary, photographic or
artistic work to a newspaper, magazine or
periodical for publication shall constitute only a
license to make a single publication unless a
greater right is expressly granted. If two (2) or
UP LAW BOC INTELLECTUAL PROPERTY CODE
more persons jointly own a copyright or any part
thereof, neither of the owners shall be entitled
to grant licenses without the prior written
consent of the other owner or owners. [Sec.
180.3, RA 8293]
The copyright is distinct from the property in the
material object subject to it. Consequently, the
transfer, assignment or licensing of the
copyright shall not itself constitute a transfer of
the material object. Nor shall a transfer or
assignment of the sole copy or of one or several
copies of the work imply transfer, assignment or
licensing of the copyright. [Sec. 181, RA 8293 as
amended by RA 10372]
The owners of copyright and related rights or
their heirs may designate a society of artists,
writers, composers and other right-holders to
collectively manage their economic or moral
rights on their behalf. For the said societies to
enforce the rights of their members, they shall
first secure the necessary accreditation from the
Intellectual Property Office. [Sec. 183, RA 8293
as amended by RA 10372]
G. LIMITATIONS ON COPYRIGHT
G.1. DOCTRINE OF FAIR USE
The fair use of copyrighted work for criticism,
news reporting, teaching (including multiple
copies for classroom use), research and similar
purposes is not an infringement of copyright.
A privilege, in persons other than the owner of
the copyright, to use the copyrighted material in
a reasonable manner without his consent,
notwithstanding the monopoly granted to the
owner by the copyright. It is meant to balance
the monopolies enjoyed by the copyright owner
with the interests of the public and of society.
Decompilation - Refers to the reproduction of
the code and translation of the forms of the
computer program to achieve the inter-
operability of an independently created
297
MERCANTILE LAW
computer program with other programs. This
may also constitute fair use [Sec. 185.1, RA
8293].
The fact that a work is unpublished shall not by
itself bar a finding of fair use if such finding is
made upon consideration of all the above
factors. [Sec 185.2, RA 8293]
Factors to consider in determining Fair Use
(1) The purpose and character of the use,
including whether such use is of a
commercial nature or is for non-profit
educational purposes;
(2) The nature of the copyrighted work;
(3) The amount and substantiality of the
portion used in relation to the copyrighted
work as a whole; and
(4) The effect of the use upon the potential
market for or value of the copyrighted work
[Sec. 185.1, RA 8293; (Harper & Row v.
Nation Enterprise, 471 US 539, 105 S.Ct. 2218,
85 L.Ed.2d 588]
The format of a show is not copyrightable.
[Joaquin vs Drilon 302 SCRA 225 (1999)]
A compilation is not copyrightable per se, but it
is copyrightable only if its facts have been
selected, coordinated, or arranged in such a
way that the resulting work as a while
constitutes an original work of authorship.
Otherwise known as the Sweat of the Brow or
Industrious Collection Test. [Feist Publications
Inc vs. Rural Tel Service 499 US 340 (1991)]
An exception is carved out for lawyers and
officers of the court against plagiarism when
writing judicial documents that will be part of
court record. [In the Matter of the Charges of
Plagiarism etc Against Associate Justice
Mariano C. Del Castillo AM No 10-7-17-SC
(2011)]
UP LAW BOC INTELLECTUAL PROPERTY CODE
G.2. COPYRIGHT INFRINGEMENT
Infringement of Copyright and Related Rights:
means any violation of the rights under the
Intellectual Property Code and/or the
applicable Intellectual Property Law, including
the act of any person who at the time when
copyright subsists in a work has in his
possession an article which he known, or ought
to know, to be an infringing copy of the work f or
the purpose of:
(1) Selling, letting for hire, or by way of trade
offering or exposing for sale, or hire, the
article
(2) Distributing the article for purpose of trade,
or for any other purpose to an extent that
will prejudice the rights of the copyright
owner in the work; or
(3) Trade exhibit of the article in public. [Sec.
1(l), Rule 1, Rules and Regulations on
Administrative Complaints for Violation of
Laws involving Intellectual Property Rights]
Infringement consists in the doing by any
person, without the consent of the owner of the
copyright, of anything the sole right to do which
is conferred by statute on the owner of the
copyright. For there to be substantial
reproduction of a book, it does not necessarily
require that the entire copyrighted work, or even
a large portion of it, be copied. If so much is
taken that the value of the original work is
substantially diminished, there is an
infringement of copyright and to an injurious
extent, the work appropriated. It is no defense
that the pirate did not know whether or not he
was infringing any copyright; he at least knew
that what he was copying was not his, and he
copied at his peril. In cases of infringement,
copying alone is not what is prohibited. The
copying must produce an injurious effect.
[Habana et al vs. Robles et al. (1999)]
Copyright infringement and unfair competition
are not limited to the act of selling counterfeit
goods. They cover a whole range of acts from
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MERCANTILE LAW
copying, assembling, packaging to marketing,
including the mere offering for sale of
counterfeit goods. [Microsoft Corp vs. Maxicorp
Inc. (2004)]
A copy of a piracy is an infringement of the
original, and it is no defense that the pirate, in
such cases, did not know what works he was
indirectly copying, or did not know whether or
not he was infringing any copyright; he at least
knew that what he was copying was not his, and
he copied at his peril. In determining the
question of infringement, the amount of matter
copied from the copyrighted work is an
important consideration. To constitute
infringement, it is not necessary that the whole
or even a large portion of the work shall have
been copied. If so much is taken that the value
of the original is sensibly diminished, or the
labors of the original author are substantially
and to an injurious extent appropriated by
another, that is sufficient in point of law to
constitute a piracy. [Columbia Pictures v. CA
(1996)]
The following shall NOT constitute infringement
of copyright:
(1) Recitation or performance of a work once it
has been made accessible to the public if (1)
privately done AND free of charge OR (2)
strictly for a charitable or religious
institution; [Sec. 184.1(a), RA 8293]
(2) Making of quotations from a published
work: (i) compatible with fair use, (ii) extent
is justified by the purpose, (iii) source and
name of the author, appearing on work,
must be mentioned; [Sec. 184.1(b), RA 8293]
(3) Reproduction or communication to the
public by mass media of articles on current
political, social, economic, scientific or
religious topic, lectures, addresses and
other works, delivered in public: (i) for
information purposes, (ii) not expressly
reserved, and (iii) source is already
indicated; [Sec. 184.1(c), RA 8293]
UP LAW BOC INTELLECTUAL PROPERTY CODE
(4) Reproduction and communication to the
public of literary, scientific or artistic works
as part of reports of current events by
means of photography, cinematography or
broadcasting to the extent necessary for the
purpose; [Sec. 184.1(d), RA 8293]
(5) Inclusion of a work in a publication,
broadcast or other communication to the
public, sound recording or film if made by
way of illustration for teaching purposes
compatible with fair use and the source and
the name of the author appearing on work,
must be mentioned; [Sec. 184.1(e), RA 8293]
(6) Recording made in schools, universities, or
educational institutions of a work included
in a broadcast for the use of schools,
universities or educational institutions.
Such recording must be deleted within a
reasonable period; such recording may not
be made from audio-visual works which are
part of the general cinema, repertoire of
feature films except of brief excerpts of the
work; [Sec. 184.1(f), RA 8293]
(7) Making of ephemeral recordings; (i) by a
broadcasting organization, (ii) by means of
its work or facilities, (iii) for use in its own
broadcast; [Sec. 184.1(g), RA 8293]
(8) Use made of a work by or under the
direction or control of the government for
public interest compatible with fair use; [Sec.
184.1(h), RA 8293]
(9) Public performance or the communication
to the public of a work in a place where no
admission fee is charged by a club on
institution for charitable or educational
purpose only and the aim is not profit-
making; [Sec. 184.1(i), RA 8293]
(10) Public display of the original or a copy of the
work not made by means of a film, slide,
television, image or otherwise on screen or
by means of any other device or process
either the work has been published, sold,
given away, or transferred to another
person by the author or his successor in
title; [Sec. 184.1(j), RA 8293]
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MERCANTILE LAW
(11) Use made of a work for the purpose of any
judicial proceedings or for the giving of
professional advice by a legal practitioner.
[Sec. 184.1(k), RA 8293]
(12) The reproduction or distribution of
published articles or materials in a
specialized format exclusively for the use of
the blind, visually- and reading-impaired
persons: Provided, That such copies and
distribution shall be made on a nonprofit
basis and shall indicate the copyright owner
and the date of the original publication. [Sec.
184.1(l), RA 8293 as amended by RA 10372]
Reproduction of Published Work
General Rule: The private reproduction of a
published work in a single copy, where the
reproduction is made by a natural person
exclusively for research and private study, shall
be permitted, without the authorization of the
owner of copyright in the work. [Sec. 187.1, RA
8293]
Exceptions: Such permission shall not extend to:
(1) A work of architecture in the form of
building or other construction;
(2) An entire book, or a substantial part thereof,
or of a musical work in graphic form by
reprographic means;
(3) A compilation of data and other materials;
(4) A computer program except as provided in
Section 189; and
(5) Any work in cases where reproduction
would unreasonably conflict with a normal
exploitation of the work or would otherwise
unreasonably prejudice the legitimate
interests of the author. [187.2, RA 8293]
Reprographic Reproduction by Libraries
Any library or archive whose activities are not
for profit may, without the authorization of the
author of copyright owner, make a single copy
of the work by reprographic reproduction:
(1) Where the work by reason of its fragile
character or rarity cannot be lent to user in
its original form;
UP LAW BOC INTELLECTUAL PROPERTY CODE
(2) Where the works are isolated articles
contained in composite works or brief
portions of other published works and the
reproduction is necessary to supply them,
when this is considered expedient, to
persons requesting their loan for purposes
of research or study instead of lending the
volumes or booklets which contain them;
and
(3) Where the making of such a copy is in order
to preserve and, if necessary in the event
that it is lost, destroyed or rendered
unusable, replace a copy, or to replace, in
the permanent collection of another similar
library or archive, a copy which has been
lost, destroyed or rendered unusable and
copies are not available with the publisher.
[Sec. 188.1, RA 8293]
It shall not be permissible to produce a volume
of a work published in several volumes or to
produce missing tomes or pages of magazines
or similar works, unless the volume, tome or
part is out of stock: Provided, That every library
which, by law, is entitled to receive copies of a
printed work, shall be entitled, when special
reasons so require, to reproduce a copy of a
published work which is considered necessary
for the collection of the library but which is out
of stock. [Sec. 188.2, RA 8293)]
Reproduction of Computer Program
The reproduction in one (1) back-up copy or
adaptation of a computer program shall be
permitted, without the authorization of the
author of, or other owner of copyright in, a
computer program, by the lawful owner of that
computer program: Provided, That the copy or
adaptation is necessary for:
(a) The use of the computer program in
conjunction with a computer for the
purpose, and to the extent, for which the
computer program has been obtained; and
(b) Archival purposes, and, for the replacement
of the lawfully owned copy of the computer
program in the event that the lawfully
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MERCANTILE LAW
obtained copy of the computer program is
lost, destroyed or rendered unusable. [Sec.
189.1, RA 8293]
No copy or adaptation mentioned in this Section
shall be used for any purpose other than the
ones determined in this Section, and any such
copy or adaptation shall be destroyed in the
event that continued possession of the copy of
the computer program ceases to be lawful. [Sec.
189.2, RA 8293]
Importation for Personal Purposes
The importation of a copy of a work by an
individual for his personal purposes shall be
permitted without the authorization of the
author of, or other owner of copyright in, the
work under the following circumstances:
(1) When copies of the work are not available in
the Philippines and:
(a) Not more than one (1) copy at one
time is imported for strictly
individual use only; or
(b) The importation is by authority of
and for the use of the Philippine
Government; or
(c) The importation, consisting of not
more than three (3) such copies or
likenesses in any one invoice, is not
for sale but for the use only of any
religious, charitable, or educational
society or institution duly
incorporated or registered, or is for
the encouragement of the fine arts,
or for any state school, college,
university, or free public library in
the Philippines.
(2) When such copies form parts of libraries
and personal baggage belonging to persons
or families arriving from foreign countries
and are not intended for sale: Provided, that
such copies do not exceed three (3). [Sec.
190.1, RA 8293 is repealed by RA 10372]
Copies imported as allowed by this Section may
not lawfully be used in any way to violate the
UP LAW BOC INTELLECTUAL PROPERTY CODE
rights of owner the copyright or annul or limit
the protection secured by this Act, and such
unlawful use shall be deemed an infringement
and shall be punishable as such without
prejudice to the proprietor's right of action. [Sec.
190.2, RA 8293 is repealed by RA 10372]
Importation and Exportation of Infringing
Materials. Subject to the approval of the
Secretary of Finance, the Commissioner of
Customs is hereby empowered to make rules
and regulations for preventing the importation
or exportation of infringing articles prohibited
under Part IV of this Act and under relevant
treaties and conventions to which the
Philippines may be a party and for seizing and
condemning and disposing of the same in case
they are discovered after they have been
imported or before they are exported [Sec. 190,
RA 8293 as amended by RA 10372]
IV. Rules of Procedure
for Intellectual Property
Rights Cases (A.M. No.
10-3-10 SC)
A. IN WHAT COURTS APPLICABLE
These Rules shall be observed by Regional Trial
Courts designated by the Supreme Court as
Special Commercial Courts.
B. APPLICABILITY OF REGULAR
RULES
General Rule: The Rules of Court (RoC) shall
apply suppletorily to these Rules.
Exception: When the civil or criminal action
involves complex issues, the Court shall issue a
special order that the regular procedure
prescribed in the RoC.
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The following are specific rules applicable in
IPR Cases:
(a) Rules 2-9 of the RoC shall apply to all civil
actions for violation of intellectual property
rights under RA 8293 and other violations
of intellectual property rights as may be
defined by law.
(b) Special Commercial Courts in Quezon City,
Makati, Manila, and Pasig shall have
authority to act on applications for the
issuance of writs of search and seizure in
civil actions for violations of the Code,
enforceable nationwide. Special
Commercial Courts have concurrent
jurisdiction over applications enforceable
within their own jurisdiction for violations
within the judicial region.
(c) It shall be the duty of the Clerk of Court to
notify the Director-General of the
Intellectual Property Office of any action
involving a copyright, trademark, service
mark, patent, industrial design, utility
model, undisclosed information, and
technology transfer agreement.
C. COMMENCEMENT OF CIVIL ACTION
C.1. PLEADINGS:
The only pleadings allowed to be filed are the
complaints, compulsory counterclaims, and
cross-claims pleaded in the answer, and the
answers thereto. All of them shall be verified.
C.2. WHO MAY FILE:
(a) Any IPR owner, or anyone possessing any
right, title, or interest under claim of
ownership in any IPR, whose right may have
been violated;
(b) Any person who is a national or who is
domiciled or has a real and effective
industrial establishment in a country which
is a party to any convention, treaty or
agreement relating to IPR or the repression
of unfair competition, to which the
Philippines is also a party, or extends
reciprocal rights to Filipinos by law;
UP LAW BOC INTELLECTUAL PROPERTY CODE
(c) Any foreign national or juridical person who
meets the requirements of the preceding
paragraph, and does not engage business
in the Philippines.
C.3. FORM AND CONTENTS OF THE
PETITION:
(1) Full names of parties to the case;
(2) Facts showing capacity of parties to sue or
be sued, or the authority of a party to sue or
be sued in a representative capacity, or the
legal existence of an organized association
of persons that is made a party;
(3) ultimate facts showing the cause of action
(4) reliefs sought;
(5) an affidavit in question-and-answer format
must be attached to the complaint. Such
affidavit shall state only the facts of direct
personal knowledge to the affiants which
are admissible in evidence, and shows the
competence of the affiants to testify.
(6) Certificate of non-forum shopping.
C.4. PROHIBITED PLEADINGS:
(a) Motion to dismiss
(b) Motion for bill of particulars
(c) Motion for reconsideration of a final order
judgment, except with regard to an order of
destruction
(d) Reply
(e) Petition for relief from judgment
(f) Motion for extention of time to submit
pleadings, except for meritorious reasons
(g) Motion for postponement intended for delay
(h) Third-party complaint
(i) Intervention
(j) Motion to hear affirmative defenses
(k) Any petition or motion with similar effect to
the foregoing.
C.5. FAILURE TO FILE COMPLAINT
WHERE A WRIT OF SEARCH AND
SEIZURE IS ISSUED:
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Applicant has 31 days from issuance of writ to
file a case before the appropriate court or quasi-
judicial agency.
For failure to file a case, the Court may, upon
motion of the owner of the seized goods, order
the return of such goods. Such motion must be
filed within 60 days from the expiration of the
period to file cases.
If the owner fails to file the motion, the Court
may dispose of the goods after notice and
hearing.
C.6. SUMMONS:
Summons shall be served no later than 5 days
from receipt of the complaint.
C.7. ANSWER:
Must be filed 15 days afer service of summons;
10 days if answer to compulsory counterclaim or
cross-claim.
Should the defendant fail to answer, the Court
may, motu proprio or upon motion of the
plaintiff, render judgment based on the
affidavits and the evidence on record unless it
requires the submission of additional evidence.
D. MODES OF DISCOVERY
A party may avail of the different modes of
discovery not later than 30 days from the
joinder of issues.
Any objection must be made within 10 days
from receipt of the request for discovery and
only on the ground that the matter requested is
manifestly incompetent, irrelevant, immaterial,
privileged in nature or for harassment.
A comment on the objection may be made in
writing within 3 days from receipt of the same.
The Court then has 10 days to decide on the
objection.
UP LAW BOC INTELLECTUAL PROPERTY CODE
Compliance with any mode of discovery shall be
made within 10 days from receipt of the request
for discovery, or from notice of the ruling of the
court.
Sanctions provided in the RoC in relation to the
modes of discovery shall apply.
E. PRE-TRIAL
The Court shall set the case for pre-trial 5 days
after the after the period for availing modes of
discovery or compliance whichever comes later.
The Court shall then direct the parties to appear
before the Philippine Mediation Center in
accordance with mediation rules. Should parties
fail to settle the case at mediation, the Court
shall conduct JDR conferences.
If either fails, the case shal be sent back to the
court for pre-trial.
F. CLARIFICATORY HEARINGS AND
TRIAL
Clarificatory hearings must be conducted within
30 days from pre-trial, to be completed not
later than 15 days thereafter.
Immediately after the termination of the
clarificatory hearings the parties must submit
their position papers within 10 days.
The judicial affidavits attached to the position
papers shall serve as the direct testimony of the
witnesses, subject to cross-examination.
The period of trial shall be 30 days allotted to
the plaintiff and defendant.
After an oral ruling on the last offer of evidence,
the Court shall direct the parties to submit their
respective draft decisions within a non-
extendible period of 30 days from receipt of
order.
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G. COMMENCEMENT OF CRIMINAL
ACTION
A criminal action is commenced by the filing of
an information after a prior verified complaint is
filed under Rule 112 of the RoC.
H. COMMON RULES ON
ADMISSIBILITY OF EVIDENCE
Good faith NOT a defense, unless the defendant
or accused claims to be a prior user.
All official records kept in a foreign country,
including certificates of registration, are
admissible in the Philippines if authenticated by
the consular office of the Philippines having
jurisdiction over the country where such records
are kept.
Authentication of documents may be subject of
agreement of the parties.
The deposition of foreign witnesses must be
made 6 months following the order of
deposition, unless failure to take the deposition
is caused by fortuitous event, fraud, accident,
mistake, or excusable negligence.
Presumptions in the Intellectual Property Code
shall apply to these Rules.
I. EVIDENCE IN PATENT CASES
Subject matter is a patent for process for
obtaining a product:
Any identical product is presumed to have been
obtained through the use of the patented
process if:
(1) The product is new;
(2) There is substantial likelihod that the
product was made by the process and that
the owner of the patent has been unable,
despite reasonable efforts, to determine the
process actually used.
UP LAW BOC INTELLECTUAL PROPERTY CODE
In such cases the Court shall order the
defendant/accused to show that the the
process he used to obtain the identical product
is different from the patented process.
Presumptions concerning patents:
(1) A letters patent issued by the IPO is prima
facie evidence of its existence and validity
during the term specified, unless cancelled
or voided by final judgment.
(2) Letters patent issued by the IPO are
presumed to have been validly issued
unless overcome by evidence of irregularity.
(3) It is presumed that the defendant/accused
is aware of the existence of the patent if the
words "Philippine patent" with the patent
number are written on:
(a) the patented invention or the product
manufactured using the patented
process
(b) on the container or the package in
which said article is supplied to the
public
(c) on the advertising material related to
the patented invention or process.
J. EVIDENCE IN TRADEMARK
INFRINGEMENT AND UNFAIR
COMPETITION CASES
A certificate of registration shall be prima facie
evidence of:
(1) The validity of the registration
(2) The registrant's ownership of the mark
(3) The registrant's right to exclusively use
the same
Determination of a well-known mark:
Knowledge of the relevant sector of the public,
rather than the knowledge of the general public,
shall be taken into account. (for the criteria in
determining a well-known mark, see
Determinants, supra.)
Likelihood of confusion:
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MERCANTILE LAW
In determining likelihood of confusion, the
Court must consider the general impression of
the ordinary purchaser, buying under the
normally prevalent conditions of trade, and
giving such attention buyers normally give in
buying that class of goods.
The following factors are taken into account:
(1) Strength of the plaintiff's mark
(2) Degree of similarity between the
plaintiff's and the defendan's marks
(3) Proximity of the products or services.
(4) Likelihood that the plaintiff will bridge
the gap
(5) Evidence of actual confusion
(6) Defendant's good faith in adopting the
mark
(7) Quality of the defendant's service
(8) Sophistication of the buyers
"Colorable imitation" - denotes a close or
ingenious imitation as calculated to deceive
ordinary persons, or such a resemblance to the
original as to deceive an ordinary purchaser
giving such attention as a purchaser usually
gives, as to cause him to purchase the one
supposing it to be the other.
Intent to Defraud
There is a presumption of an intent to defraud:
(1) When the defendant passess of a
product as his by using imitative devices,
signs, or marks on the general
appearance of the goods, misleading
purchasers into buying his merchandise
under the impression that they are
buying that of his competitors.
(2) When the defendant makes a false
statement in the course of trade to
discredit the goods and business of
another.
(3) Where the similarity of the goods as
packed and offered for sale is so striking.
K. EVIDENCE IN COPYRIGHT CASES
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Presumption of Copyright
Copyright is presumed to subsist and ownership
thereof shall be presumed to belong to the
complainant if he so claims through affidavit
evidence, unless defendant attaches proof to
the contrary in his answer to the complaint.
Mere denial of the subsistence of the copyright
based on lack of knowledge shall not be
sufficient to rebut the presumption.
Effect of registration and deposit
Registration and deposit of copyrighted work is
not a condition sine qua non to a claim of
copyright infringement.
Presumption of authorship (supra.)
International registration of works
A statement concerning a work, recorded in an
international register in accordance with an
international treaty to which the Philippines is
or may become a party, shall be construed as
true until the contrary is proved, except:
(a) Where the statement cannot be
valid under the Intellectual Property
Code or any other law concerning
intellectual property;
(b) Where the statement
contradicted by another statement
in the register.
The hearing shall be summary in nature with
notice of hearing addressed to defendant to
afford him opportunity to oppose the motion.
Conditions for the Order of Destruction
(a) Inventory and photographs of the seized
infringing goods taken before
destruction
(b) Taking and inventory must be witnessed
by the (i) accused, counsel or agent; (ii)
the complainant, his representative, or
counsel,
(c) A representative sample of the seized
goods must be retained for evidentiary
purposes
(d) An inventory of the samples must have
been made
(e) The officer authorized to supervise the
destruction has submitted a report
thereon within 5 days from the date of
the destruction
(f) Posting of a bond by the applicant
is

L. ORDER OF DESTRUCTION
At any time after the filing of the complaint or
information, the Court, upon motion and after
due notice and hearing where the violation of
the intellectual property rights of the owner is
established, may order the destruction of the
seized infringing goods, objects and devices,
including but not limited to, sales invoices,
other documents evidencing sales, labels, signs,
prints, packages, wrappers, receptacles, and
advertisements and the like used in the
infringing act.

305