New South African’s IP policy has been published

The National Development Plan (NDP) of South Africa calls for a greater emphasis on innovation, improved productivity, an intensive pursuit of a knowledge economy and the better exploitation of comparative and competitive advantages. Intellectual Property (IP) is an important policy instrument in promoting innovation, technology transfer, research and development (R&D), creative expression, consumer protection, industrial development and more broadly, economic growth.

The National Industrial Policy Framework (NIPF), implemented through the Industrial Policy Action Plan (IPAP), is a central component of South African’s economic development strategy. The NIPF and IPAP seek to encourage and upgrade value-added, labour-absorbing industrial production, and diversify the economy, by moving away from the current over-reliance on commodities and non-tradable services. Knowledge, innovation and technology are increasingly becoming the drivers of progress, growth and wealth.

The goals of this comprehensive IP Policy are:

  • To consider the development dynamics of South Africa and improve how IP supports small institutions and vulnerable individuals in society, including in the domain of public health
  • To nurture and promote a culture of innovation, by enabling creators and inventors to reach their full potential and contribute towards improving the competitiveness of South African’s industries
  • To promote South African arts and culture
  • To solidify South Africa’s various international obligations, such as the Convention on Biological Diversity (CBD) and the Nagoya Protocol on Access to Genetic Resources and the Fair and Equitable Sharing of Benefits Arising from their Utilisation (Nagoya Protocol on ABS), in the service of our genetic resources and traditional knowledge associated with genetic resources

The comprehensive IP Policy will be implemented in a phased approach. The current document constitutes the first phase in what will be a comprehensive policy to be developed and updated over the medium term. Phase I covers IP and public health, coordination in international forums, and the implementation of commitments undertaken in international agreements. Phase I priorities have been identified on the basis of South Africa’s development objectives, supplemented by research, analysis, and experience, as well as assessments of existing capacity to implement the measures outlined herein.

The comprehensive IP Policy proposes key reforms that are aimed at advancing South Africa’s socio-economic development objectives as outlined in key policy documents of the national government, such as the National Development Plan (NDP), the New Growth Path Framework (NGP), National Drug Plan, NIPF and the various iterations of IPAP. The key reforms include:

  • The introduction of substantive search and examination (SSE) for patents, which is a key step towards ensuring that the patent regime fulfils its purpose of stimulating genuine innovation. This will benefit patent holders by granting them rigorously assessed rights, and benefit the public at large by ensuring that market exclusivity is only granted when appropriate. Importantly, SSE will not only apply in the health sphere; it will eventually have much broader application. However, with due regard to capacity constraints and resources, the IMCIP – in consultation with diverse stakeholders – will determine the initial fields in which full SSE will occur. These fields will be progressively expanded, as the capacity of the state increases.
  • The leveraging of flexibilities contained in the Agreement on Trade-Related Aspects of Intellectual Property Rights (TRIPS) to ensure that South Africa protects IPRs while simultaneously promoting public health, local manufacture, research and development, innovation, food security, environmental considerations, transfer of technology and broad socio-economic development.
  • The promotion of economic empowerment through, among other means, the implementation of the “utility model” to support the registration of patents by resident small, medium and micro-enterprises (SMMEs), historically disadvantaged individuals, and companies who are operating in the informal sector. This entails enacting exclusivity similar to a patent right, granted by a state, to an inventor or the inventor’s assignee, for a fixed period of time. However, the terms and conditions for granting a utility model are slightly different from those for ordinary patent, including a shorter term of protection and less stringent patentability requirements. The term “utility model” is sometimes addressed differently in other countries, with the terms “petty patents”, “short-term patents” or “innovation patents”.
  • A coordinated approach to creating awareness about IP among South Africans, so as to protect nationally-owned IP that is related to indigenous resources, traditional innovation and traditional knowledge.
  • The creation of a system for protection for traditional knowledge which will guard against misappropriation and exploitation, as well as promote further research and development into products and services based on traditional knowledge.

Users of IP are prejudiced on the other hand because subject matter that should be in the public domain can be unfairly monopolised by exclusive rights. Moreover, the underlying policy rationale of patents is to serve as an incentive to stimulate innovation. Granting an exclusive right in the absence of genuine innovation is anathema to the proverbial bargain that the patent holder is supposed to strike with society, namely, disclosure in return for monopoly protection, resulting in society being short-changed, and overall negative consequences for both access and innovation.

It should be recalled that IP is an instrument of industrial policy that is tailored by state organs to accomplish development objectives. IP is typically characterized by limitation, such as regarding its duration. The characterization of IP as property should be understood within this context. As nations adjust their industrial policy, including in relation to social policy, so too do they adjust the rights and obligations of IP holders. In line with the South African Constitution, a balanced approach will be taken in the development of the IP Policy.