Basic Concept of Compulsory License and Government use of Patent
Compulsory License
What is it?
A compulsory license is a legal mechanism that allows a government to permit a third party to produce, use, or sell a patented invention without the consent of the patent holder.
Why is it used?
To ensure public access to essential products like medicines or vaccines, especially during emergencies or when prices are unaffordable.
To prevent abuse of patent rights, such as monopolistic pricing or failure to work the patent.
How does it work?
The government issues the license under certain conditions defined by law.
Usually, the patent holder is entitled to adequate compensation.
It can be temporary or limited to a specific purpose or region.
Legal basis:
Internationally regulated by the TRIPS Agreement (Article 31).
Implemented through national laws.
Government Use of Patent (State Use)
What is it?
This is when a government or an authorized agency uses a patented invention without the patent holder’s permission, often to meet public needs.
How is it different from compulsory license?
Government use often does not require prior negotiation or consent.
Typically applied during emergencies or when the government itself needs to use the invention for public non-commercial purposes.
The patent holder is entitled to fair remuneration, but the process is faster and less bureaucratic.
Examples:
Governments producing or importing generic versions of patented drugs during health crises.
Using patented technologies for defense or public infrastructure.
Summary Table
| Feature | Compulsory License | Government Use (State Use) |
|---|---|---|
| Who uses the patent? | Private party under government license | Government or its authorized entity |
| Consent from patent holder? | Not required but negotiation attempted | Not required |
| Purpose | Public health, anti-competitive behavior | Public non-commercial use, emergencies |
| Compensation | Yes, adequate remuneration | Yes, fair remuneration |
| Process | May involve negotiation and court proceedings | Usually direct government authorization |
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