Geographical Indication (GI) options for Ethiopian Coffee and Ghanaian Cocoa

Innovation & Intellectual Property
11(1) of the Regulations provides for the terms of non-exclusive licences to be
determined “on an arms-length basis”. NIPMO’s approval must be obtained in
cases where the “consideration payable by a licensee to a recipient is not determined
on an arms-length basis”, or where royalty-free licences are granted, or
where offshore exclusive licences are granted and/or where assignments of IP are
made locally and offshore (Sect. 11(2) of the Regulations).
Conditions that apply to all licences
Section 11(1)(e) of the Act states that each IP transaction must provide the state
with an irrevocable and royalty-free licence authorising the state to use or have the
IP used throughout the world for South Africa’s health, security and emergency
needs. Section 11(2) of the Act provides that each IP transaction must contain
a condition that “should a party fail to commercialise the intellectual property
to the benefit of [South Africa], the State is entitled to exercise” walk-in rights
provided for in Section 14 (see “state ‘walk-in’ rights” sub-section below). Section
11(3)(a) of the Act provides that where the relevant IP is assigned to a small business,
the assignment agreement must contain a condition that if the business is
liquidated, the IP will revert to the institution.
Conditions that apply only to exclusive licences
Section 11(1)(d) of the Act requires that “exclusive licence holders must undertake,
where feasible, to manufacture, process and otherwise commercialise” the
invention in South Africa, failing which NIPMO has the power to request that the
exclusive licence be converted into a non-exclusive licence.
Conditions that apply to offshore transactions
Section 12 of the Act requires institutions to notify NIPMO and to obtain its
approval before concluding offshore exclusive IP transactions (exclusive licences
and assignment), i.e. licences and assignments granted outside South Africa. Such
approval will only be given pursuant to a number of considerations, including
the requirement that NIPMO is satisfied that there is insufficient capacity within
South Africa to commercialise the IP.
State “walk-in” rights
Sections 14(2) and 14(3) of the Act and Section 14(1) of the Regulations require
NIPMO to conduct annual reviews of non-commercialised IP in consultation
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