July 12, 2005

Reform Bill on Invention Promotion Act – “Invention Promotion Act for a Mutual Benefit”

Business Group and Science & Technology Group Have Finally Agreed to the Compromise Plan Suggested by KIPO.

□ Time has finally come for the activation of the Reform operation on the Invention Promotion Law, which had been carried out by Korean Intellectual Property Office (KIPO) for the purpose of vitalizing the activity of service inventions in the country. After five years of heated negotiations, the business and science & technology groups have finally agreed to KIPO’s compromise plans. As a result, a new bill (Reform Bill on Invention Promotion Act) related to the issue of management and remuneration of service inventions will be introduced.

o In response to the publics argument, which argues that the removal of regulations regarding “Free Invention” would ultimately lead to removal of employee’s interests, KIPO has announced that they have met consensus with the business and science & technology groups in agreeing to the most recent amendment after going through numerous discussions and adjustments.

o Representing the side of science & technology and business, Vice-President Young-bae, Kim, Secretary General Yu-hyun Mun, and Sang-wook, Park from the Federation of Science &Technology Society (Scieng) have met with director Jong-gap, Kim of KIPO to finalize their agreement with KIPO’s amendment after submitting the compromise plans from the previous conferences.
□ Despite the government’s constant effort in the last five years to improve the service invention regimes, the sharp opposition in opinions between the business group and science & technology group have resulted in continuous failure in improving the remuneration regime of service inventions.
o However, this recent compromise shows that significant progress has been made by the government in resolving the five years of conflict and distrust among the interested parties and setting up an appropriate direction for the mutual benefit of both interested parties, the business and science & technology parties.

□ After announcing the passing of the invention promotion act KIPO has established a close cooperative structure between the representative from business and science & technology group, and has been pursuing constant communications and negotiations.
o The director of KIPO has met with the representative from Scieng and listened attentively to his opinions.
o For business purpose, it has been revealed that the director has narrowed the gap of difference regarding the opinions on the issue concerned by keeping in touch with the representatives from the Business and Science & technology group by telephone and email.

□ When we examine the recent amendment, we can see that KIPO has considered the demands from the science & technology group on the issue of ‘Free Invention’, which has been the central issue of conflict.
o In the previous act, inventions were considered as ‘free inventions’ only when no proper applications were filed for four months after the users received the title for those inventions.
- With the new amendment, the current regulations on free invention will be removed. However, as a result of considering the suggestions that have been proposed by the Science & technology group, inventions will be considered as ‘free inventions’ only when the users did not report their history of title acquisition during the period set by the president. In such case, the user will be granted with a right for the normal usage of the invention only after receiving an approval from the inventor.

o With passing of this amendment, users are now allowed to decide their own time for making application for the proper usage of a invented products or choose not to go through such process at all. As a result, people have become more flexible in dealing with the ever-growing domestic and international competition on invention of high technologies.
- Inventors have acquired a perfect control over the rights that are associated with their inventions. The users are not allowed to utilize the inventions under a normal condition until they have received the approval from the inventor when they have not reported the proper grant of the invention.

□ Furthermore, a new remuneration standard for service invention was enacted to give more value to the public’s decision on determining the type and amount of the remuneration concerned. The interested groups have decided to agree to this new standard after making sure that the original structure of previous standard is maintained with all its ambiguous details cleared up.

o This agreement was hard to settle due to intense opposition between the business and the science & technology groups, as the business side wanted more self-control over the remuneration of service invention whereas the science & technology side wanted a proper standard such as the minimum income standard to protect the rights of inventors.

o However, the two sides have agreed to follow the fundamental rule regarding the remuneration process for service inventions due to a spontaneous concession from the two sides for the purpose of mutual benefit. This agreement was established when appropriate type and amount of remuneration had to be settled as the two sides have understood the purpose of the amendment, which indicates that securing the highest rationality during the consultation procedure will lead the users to remunerate the inventors voluntarily.

□ KIPO director Jong-gap, Kim announced, “This compromise is a valuable result for KIPO and the interested groups which was achieved by consistent discussion and reasonable concession based on the trust between the two sides“. He further proclaimed “As this was a difficult achievement for both KIPO and the interested parties, we will quickly carry out the subsequent tasks to acquire the government bill as soon as possible“.
o In response to the recent increase in the number of patent applications, the two interested parties have acknowledged the importance of cooperation in order to establish an effective economic structure.
o The government has also proposed an expansion and prioritization on supporting of R&D tasks regarding proper operation of remuneration regime for service inventions.

□ From a pan government level, KIPO has planned to carry out the following tasks in order to support the activation of remuneration regime for service inventions of public organizations,
o Expand the beneficial measures such as granting of extra point to the organization associated with the remuneration of service invention when evaluating organizations for qualification of various government funds.
o Cooperate with other ministries to expand the executive ministries who would perform the operation plan concerned, which is currently being carried out solely by the Ministry of Commerce, Industry and Energy on remunerating the service inventions of the organizations who supported the government’s R&D task.

(Source: KIPO Press Material, Date: July 8, 2005)